Standard Bank's role in PIC transactions warrants 'closer scrutiny'

STANDARD Bank's historical involvement in several high-profile infrastructure transactions has come under renewed public scrutiny following ongoing discussions around governance, transparency, and the role of financial institutions in state-linked investments.

- MANYANE MANYANE

Among these transactions are deals connected to Harith General Partners, one of Africa's largest infrastructure investors, which manages significant assets on behalf of the PIC, the continent's biggest fund manager. Harith led a consortium that, in 2012, acquired 100% of Lanseria International Airport, one of South Africa's key privately owned airports.

The consortium's shareholding included the Government Employees Pension Fund (GEPF) through the PIC, alongside a Black Economic Empowerment (BEE) partner, Acapulco Trade and Investment. Acapulco is currently involved in legal proceedings with the PIC over a compensation award of more than R411 million, following the collapse of a financing arrangement linked to Lanseria Holdings, the airport's operating company.

The arbitration award came despite Acapulco's reported default on the underlying debt, which escalated to approximately R630m.

United Democratic Movement (UDM) leader General Bantu Holomisa has recently voiced concerns regarding the structuring of certain investment deals involving the PIC and commercial banks. In correspondence addressed to President Cyril Ramaphosa and Standing Committee on Public Accounts (Scopa) chairperson Songezo Zibi, Holomisa raised questions about whether some transactions may have exposed public funds particularly those of pensioners to disproportionate financial risk.

Holomisa did not accuse any bank of wrongdoing but urged greater oversight of financial institutions that repeatedly feature in such deals. When asked which institution was most often associated with PIC and GEPF transactions, he identified Standard Bank as one that frequently appeared as an advisor or financier.