ANC secretary general Gwede Mantashe said he was worried that the decision by South Africa’s top four banks to close the accounts of the Gupta-owned Oakbya Investments could become a trend of collusion between financial institutions.
Such a trend would involve the collusion of financial institutions to destroy small companies that posed a threat to bigger companies, he said.
Mantashe appeared to disagree with the approach of his comrades in Cabinet, who last month established a ministerial committee to intervene with the country’s major four banks, Standard Bank, Absa, First National Bank and Nedbank, on behalf of the Gupta’s Oakbay Investments.
Instead the ANC boss said the Reserve Bank – which regulates financial institutions in the country – must answer questions about the banks’ decision.
“[The Reserve Bank must tell us] is this [the decision by the four banks] a collision, or is it an order from the regulator because the regulator has the power to do so? What actually translated to this and that? [For] me, If I was in the government task team, that’s where I would start – with the regulator – and ask: ‘What’s happening here? How is it possible that all the banks [can] take the same decision, at the same time?’,” Mantashe said.
He added that the banks were obliged to disclose information to the Reserve Bank and law enforcement agencies should they expect illegal or irregular activity regarding the now closed accounts.
However, the Reserve Bank told the Mail & Guardian in April already that it would not get involved in the dispute.
The central bank also distanced itself from the ministerial committee. “The South African Reserve Bank (SARB) is not part of the ministerial committee,” Bulelwa Boqwana, the Reserve Bank’s chief of staff said.
“As a prudential regulator, the SARB regulates and supervises the prudential requirements of commercial banks. The SARB is not in a position to get involved in differences between banks and their clients.”
While Mantashe is one of the ANC politicians who have previously raised concerns about the Gupta family’s perceived influence on senior ANC politicians and government officials, he said he found “the coordinated efforts” by the financial institutions against the family strange.
“From where I’m sitting, I get worried where the economy is still dominated by white monopoly capital – where they can actually collude to destroy smaller companies. That would be a threat to me. The biggest threat out of this, it’s not about a particular family, it’s the threat overall of the ability of banks to close accounts for smaller companies if they posed a threat to big companies. What happened between the bank and the client has nothing to do with us, but the implications are far-reaching if you look at them in detail,” said Mantashe.
Barclays Africa turns down meeting with ministerial task team
On Wednesday evening Reuters reported that South African lender Barclays Africa had turned down a meeting with the ministerial team appointed to resolve the stand-off between the banks and Oakbay Investments.
“We confirm receipt of an invitation to a meeting from the office of the Minister of Mineral Resources on behalf of the inter-ministerial committee announced by Cabinet,” Barclays Africa said. “We have respectfully declined on account of client confidentiality.”
Although the Guptas’ relationship with Zuma has been a source of controversy for years, it burst into the open last month when senior figures said the family had exerted undue sway, including offering cabinet positions.
Zuma has acknowledged the Guptas are his friends, but denies anything improper. The Guptas, whose wide range of business interests include media and mining, have denied the allegations and say they are pawns in a plot to oust Zuma.
Nedbank, a unit of Anglo-South African insurer Old Mutual, said it would approach any meeting with government constructively, but would not discuss banking relationships of any client.
The government team, which also includes Finance Minister Pravin Gordan and Labour Minister Mildred Oliphant, is due to report back on its progress at this week’s cabinet meeting, Minister in the Presidency Jeff Radebe told Reuters.
Oakbay Investments’ Chief Executive Officer Nazeem Howa has said the company would not be able to pay its workers from June 7 if it cannot restore banking relations.
Other companies that have severed ties with the companies in recent months include the local unit of KPMG and fleet management company Eqstra.
Oakbay Investments did not immediately respond to requests for comment. – Additional reporting by Reuters