Concerns about the liquidity of the South African bank – VBS Mutual Bank; that granted loan for Nkandla repayment to President Jacob Zuma has continued to make rounds in the country.
Many South Africans vented their deep concern after the CEO of the lesser-known financial institution; Andile Ramavhunga declined to make public details of the transaction.
Speaking in an exclusive interview on Power FM’s Power Business show; Ramavhunga insisted that details of the transaction will not be made public because the bank sticks to loan processes no matter who the client is.
Reacting to the growing concern; the CEO made it clear that “In granting a loan, the usual processes and conditions apply no matter who the client may be.”
He added: “The mortgage bond amount applied for cannot exceed the market value of the property. Furthermore, the applicant must have a proven source of income to service the required installment repayments; which cannot exceed 30 percent of the gross income of the applicant.”
Ramavhunga also admitted that the bank was taken aback by the reactions that trailed the news of the bank; loaning Zuma R7.81m for non-security upgrades at his Nkandla home. He, however, denied that Zuma was granted the loan because he wields political power.
He, however, denied that Zuma was granted the loan because he wields political power. Rather, he disclosed that the bank has approved more than an R300m worth of similar loans to other South Africans.
VBS Mutual Bank
BuzzSouthAfrica learned that VBS Mutual Bank has been in operation since 1982, and is one of the financial institutions which offer home loans in respect of land owned by traditional authorities. The bank currently has four branches in Limpopo’s Thohoyandou‚ Sibasa‚ Makhado and in Rivonia, Johannesburg.
The presidency confirmed on Monday; that President Zuma financed the repayment of the State R7.8 million for luxuries added to his private home at Nkandla in KwaZuluNatal; through a home loan obtained from VBS Mutual Bank on its standard terms.
The payment was made a day before Zuma is due to appear in the National Assembly in a question and answer session MPs. Prior to the payment; the EFF had routinely prevented him from speaking in Parliament asking that he “pay back the money”.