Ubank placed under curatorship

• Published date: 17 May 2022
• Publication title: South African Official News

The South African Reserve Bank's (SARB) Prudential Authority (PA) has placed microfinance bank, Ubank, under curatorship.

The move, SARB Governor Lesetja Kganyago said on Monday, came after the PA in recent years intensified its supervision of Ubank due to corporate governance concerns and a high number of internal control weaknesses.

During the last couple of years, the Prudential Authority has intensified its supervision of Ubank due to corporate governance concerns, a high number of internal control weaknesses, and the prolonged period it has taken to secure the injection of sufficient capital.

Addressing reporters, Kganyago said the decision was also prompted by Ubank's prolonged period to secure the injection of sufficient capital to comply with the minimum capital requirements; diversify the bank's business model; and ensure the future sustainability of the bank.

The bank has a long history of providing basic financial services to mine workers and their families.

He said: 'After having duly considered the seriousness of the issues facing the bank, and given that Ubank is unlikely to immediately meet its obligations as required by the Banks Act and the Regulations relating to Banks, the Minister of Finance, in consultation with the Prudential Authority, has decided to place Ubank under curatorship with immediate effect.

'This is being done to proactively mitigate the adverse consequences on Ubank's depositors, and to preserve the stability of the South African banking and financial services sector as a whole.'

Upon an appointment of a curator, the management of Ubank vests in the curator, subject to the supervision of the PA, that any other person vested with the management of the affairs of Ubank shall be divested thereof.

The curator is also required to recover and take possession of all the assets of Ubank. Furthermore, the Prudential Authority is...