African Bank ‘Good Bank’ has received a banking licence by the Reserve Bank.
This follows after creditors voted in favour of an offer to transfer their debt instruments from the fallen African Bank to the newly constructed “Good Bank”.
Operations are expected to be launched at the Good Bank by April 4‚ Webber Wentzel and Linklaters said on Thursday.
“Subject to a number of conditions being fulfilled‚” a joint statement said‚ this would be “a significant milestone in the delivery of the African Bank restructuring” process.
African Bank Limited of South Africa was placed under curatorship in August 2014‚ eventually,the plans for the new bank have been received with the “overwhelming support of its creditors”.
The curator had recognized at the time that the bank needs to continue writing good business to convince the public that it merits investing in.
Johannes Gouws, Webber Wentzel partner described the whole process as “a long and complex process during which the complexities of restructuring a bank within the South African legal framework were highlighted”.
Gouws added that South Africa’s only experience of a bank curatorship in recent history‚ was successfully achieved “through the hard work of the curator and his advisory team‚ as well as the management teams at African Bank and Good Bank‚ and with the unwavering support of the South African Reserve Bank and National Treasury”.
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While Linklaters partner Richard Levy had this to say about it: “It has been some years since a significant South African bank faced a crisis of this nature. This has led to an amendment of South African banking legislation‚ which marks the prospect of further banking resolution law reform in South Africa.”
The South African Reserve Bank along with the Government Employees Pension Fund in South Africa and a consortium of banks in South Africa will be contributing to the R10-billion capitalization that will be used in establishing the new group.