No relief for Ithala depositors to access funds, despite court ruling

DESPITE a recent court judgment that limited the powers and influence of the Prudential Authority (PA) of the South African Reserve Bank (SARB) on Ithala's operations, depositors are still unable to access their funds.

- WILLEM PHUNGULA

This was revealed in a communication released to clients by the bank's management. In the notice, management informed clients that although the judgment curtailed the powers of the PA, clients would not be able to access funds.

In setting aside the section 18(3) execution order, the full bench of the Pietermaritzburg High Court confirmed that the powers of the Repayment Administrator (RA), which acted on behalf of the PA, were limited to the preservation and repayment of deposits, which meant that clients’ funds held by the bank were still inaccessible.

However, the ruling granted the bank the rights to deal with Itha-la's non-deposit-taking operations. According to the notice, debtors can pay the bank and insurance claimants could now lodge their claims.