Photo by: Reuters
The ministers tasked with intervening in the ongoing stand-off between South Africa’s big four banks and the Gupta-owned Oakbay Investments have missed their deadline.
Minister in the Presidency Jeff Radebe told Parliament via a written reply to the Democratic Alliance on Wednesday that the ministers “have not yet reported back to the Cabinet”.
On April 29, Radebe told media that the ministers were expected to report back at the last Cabinet meeting on May 11.
Mines Minister Mosebenzi Zwane, Labour Minister Mildred Oliphant and Finance Minister Pravin Gordhan were to have met with the banks to find out why they don’t want to have a certain company as their client, Radebe announced on April 21.
“It is interference? No, that is why the team of ministers will be interacting with the banks to find out the facts in this matter,” Radebe said.
Insisting this is not an investigation but an intervention, Radebe said Cabinet is concerned that the move could deter future investors.
Oakbay's auditor KPMG, the top four banks and Oakbay’s JSE sponsor Sasfin Capital all cut ties with Oakbay Investments in March and CEO Nazeem Howa has been on a mission to get the banks to rethink their move. SizweNtsalubaGobodo has since taken over as its auditor, a key requirement for Oakbay Energy & Resources to remain listed on the JSE.
Cas Coovadia, CEO of the Banking Association of South Africa, said recently “an array of regulations”, including the Fica, compelled financial services institutions to conduct due diligence on clients, “particularly those of a substantive nature and those that are in the public domain”.
"Cabinet noted the actions by the four banks that gave notice to close the bank account of a company," Radebe said in April. "Whilst Cabinet appreciate the terms and conditions of the banks, the acts may deter future potential investors who may want to do business in South Africa.”
Howa told staff in the letter that the closure of its bank accounts “made it virtually impossible to continue to do business in South Africa”.
Oakbay has been trying to keep the focus on the 7 500 jobs at risk at Oakbay, while their owners - the Guptas - resigned from all positions and have kept a low profile since.