Johannesburg - Standard Bank Group [JSE:SBK] has been
ordered to pay R528m to a union pension fund after a court ruled this month
that it had dealt in the fund's shares improperly.
Trustees of a pension fund belonging to the South African
Commercial, Catering and Allied Workers Union (Saccawu) lent Standard Bank
shares worth nearly R160m in 2002 for five years.
The bank repaid the pension fund in 2007 and also handed
over guaranteed returns agreed in its contract.
However, a court invalidated the deal this month, saying the
initial loan of the shares should never have happened.
In its ruling, the court said Standard Bank should surrender
nearly 3 million shares in mobile phone group MTN Group [JSE:MTN] and 72,595 in
media giant Naspers [JSE:NPN] - some R528m based on Thursday's prices.
It also has to hand over more stock in ElementOne and
Avusa [JSE:AVU], which have since been delisted and are therefore difficult to
"Had the pension fund just kept the shares and not lent
them to Standard Bank to utilise and take the benefits and dividend and growth,
the pension fund would have been better off to the extent of anything between
R500m and R700m," pension fund curator Tony Mostert said.
The bank has 14 days to appeal the court's December 3
decision and said it was awaiting legal advice.
"The arbitrator has made an award on some of the issues
and has yet to hear evidence and/or argument on the balance," it said in a
statement. "As the arbitration is a private process and ongoing we prefer
not to say more about it at this stage."
The court appointed Mostert custodian of the pension fund's
shares in September 2002 in place of the trustees.
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