“We won't let VBS go under”

The Thulamela Business Forum (TBF) has vowed to fight for the survival of the embattled VBS Mutual Bank. The forum is also planning to embark on protest action to try and stop the movement of clients away from VBS to Nedbank.

The curator appointed to try and rescue VBS Mutual Bank, SizweNtsalubaGobodo Advisory Services, announced two weeks ago that from Tuesday, July 10, no more withdrawals would be allowed from VBS branches. Instead, customers were encouraged to open an account at their nearest Nedbank branch, where they will be assisted. This step was made to assist hundreds of predominantly pensioners who started sleeping in queues in front of VBS branches, in the hope of withdrawing their savings.

The SA Reserve Bank (SARB) has provided the necessary guarantees that retail depositors can withdraw up to R100 000. The withdrawal limit is, however, only for retail depositors. Retail deposits are defined as deposits in VBS by individuals, burial societies, stokvels and savings clubs. The SARB guarantee does not cover municipal or corporate deposits.

The step by the curator to move the business away from VBS was not welcomed by the TBF. Hundreds of clients opened accounts at Nedbank last Friday, 13 July. All clients were advised to leave their money at the bank for at least three years before withdrawing it.

The chairperson of the TBF, Mr Ntsieni Mbulungeni, said that the curator could have handled this issue better. “It’s wrong to tell people how to use their money and where to get their money from. Many people went there to withdraw their money but were then instructed on what to do with it. People have the right to choose their own bank without being forced to invest with a certain bank. The bank is taking advantage of the fact that the people who make deposits with the bank are uneducated people,” Mbulungeni said.

The forum has submitted a memorandum of concern to Nedbank and gave the bank 24 hours to respond. The TBF also plans on launching a protest campaign, hoping to save VBS Mutual. “Internally we have started our campaign, but we will take it to the public on 24 July for them to join hands with us to save VBS. The curator should have taken into consideration that the bank is still small compared to bigger known banks. There was nothing wrong with the money of depositors; the curator should have let the bank allocate the money itself on the instruction of the bank’s curator,” added Mbulungeni.

Mbulungeni made it clear that the TBF supported the investigation into the shenanigans that happened at the bank. “The perpetrators should be brought to book,” he said. The possible criminal prosecution of the people who caused the problems should not mean the demise of the mutual bank, he said.

“The VBS Bank is not just a bank, but it symbolises the aspirations of Vhavenda people,” Mbulungeni said. He said that the step to force customers to open accounts and withdraw money from Nedbank would only create confusion and promote the perception that VBS was shutting down. 

In the memorandum TBF compiled, the argument is raised that the elderly are going to be more vulnerable to scams or robberies and that the effects of the latest steps of the curator will lead to catastrophic economic setbacks in the region.

Mbulungeni said that Nedbank was dragged into an unpleasant mess. “We tried to warn the bank to stay away from the mess that was created by the officials or executives at the bank, not by the bank itself,” he said.

The forum encouraged depositors to claim back their investments from VBS Mutual, as it is still open for business. According to the forum, VBS has not been declared closed yet, so its obituary cannot be written now.

Date:22 July 2018

By: Tracy Ngobeni

Tracy Ngobeni is a 20-year-old intern who is doing her final year in journalism at Tsh­wane University of Technology. She was born and bred in Olifantshoek. She started her journalism career in 2017, after submitting her articles to the Record Noweto Newspaper in Pretoria. Her heart beats for print media because she believes that writing can heal reader's souls.

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