Sekunjalo has expressed disappointment that the curators of Ubank have advised they could not allow the Sekunjalo Consortium an opportunity to purchase Ubank, as they had been given instructions by the Prudential Authority (PA) of South African Reserve Bank (SARB) to only sell Ubank to other banks.
Chairman of Sekunjalo Dr Iqbal Survé expressed concern about the outcome, saying: “This is extremely disappointing and worrying.
“Despite our best efforts to transform the banking sector and committing capital and resources to ensure that Ubank could be retained in the hands of workers such as NUM, it is patently clear SARB has no intention of allowing diversification of the banking industry,” said Survé.
In a letter to SARB, Sekunjalo expressed a formal interest in acquiring or recapitalising Ubank, confirming it would immediately commit R250 million to the capitalisation and expressing its confidence it could locally raise a further R250m.
Sekunjalo would be a minority shareholder within the proposed consortium, putting the interests of the people in the forefront.
In the same communication, Survé confirmed that there had also been international interest to assist with the capitalisation of Ubank for the benefit of black people in South Africa today.
Sekunjalo said it had written to the governor of SARB to clarify SARB’s position, who referred Sekunjalo back to the curator, in what can only be assumed as a pillar-to-post diversionary tactic.
The decision to refuse the Sekunjalo Consortium to purchase or recapitalise Ubank also appears to conflict with certain provisions of Section 54 of the Banks Act – Amalgamations, mergers, and arrangements, which allows for a person or an entity that is not a bank, to acquire bank assets of more than 25 percent on condition that the finance minister has granted consent and such consent is conveyed to the registrar.
Further, that should the assets being transferred amount to less than 10 percent of the total assets on the bank’s balance sheet, then there is no other requirement except for the transferring bank (in this case Ubank) to notify the registrar in writing beforehand.
Sekunjalo said it had appointed Vunani Capital as its corporate finance advisor on the Ubank acquisition. It said Vunani said the curators’ position and SARB’s position was final in that they would not entertain an offer from Sekunjalo.
Sekunjalo said the decision to only have existing banks bid for Ubank has the effect of limiting competition in the banking sector and further consolidating what was already a limited offering to South African consumers and businesses.
“While we appreciate that this is still ostensibly a free market, and that SARB can, to an extent, be selective as to who buys and operates Ubank, this disheartening decision to disallow a perfectly legitimate offer to save the bank continues to stall real transformation in the financial services industry.
“This is something that is long overdue and essential to the future of our democracy and the inclusion of our people to make a meaningful contribution to the economy,” said Sekunjalo.
The group said it hoped that the curator and SARB could rationalise and reconsider their position.
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