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Cape Town - The banks who ditched the Guptas' Oakbay Resources & Energy have no clue when they will be meeting government ministers to explain their actions, according to City Press.
Fin24 sister website, City Press, reported on Sunday that the country’s four major banks are in the dark as to when they are going to meet three government ministers tasked with intervening on behalf of Gupta businesses, including JSE-listed Oakbay Resources & Energy.
The banks - Standard Bank, FNB, Absa and Nedbank - as well as accounting firm KPMG and sponsor Sasfin Capital severed ties with the Gupta-owned firm.
Oakbay Investments is entirely owned by members of the Gupta family. That company owns 80% of Johannesburg-listed Oakbay Resources and Energy [JSE:ORL].
On Thursday Fin24 reported that the government would be stepping into the dispute between Oakbay and the banks.
Minister for Planning, Monitoring and Evaluation Jeff Radebe announced that Mines Minister Mosebenzi Zwane, Labour Minister Mildred Oliphant and Finance Minister Pravin Gordhan would meet with the banks to find out why they don’t want to have the Gupta family-owned Oakbay Investments as their client.
"Cabinet noted the actions by the four banks that gave notice to close the bank account of a company," he said. "Whilst Cabinet appreciate the terms and conditions of the banks, the acts may deter future potential investors who may want to do business in South Africa.
"Cabinet has endorsed that the ministers of Finance, Labour and Mineral Resources should open a constructive engagement with the banks to find a lasting solution to this matter," said Radebe.
He maintained that the three ministers’ “interaction” with the four banks were “normal”.
“Government and the private sector meet all the time. There is nothing extraordinary about this.”
FNB had not been approached for a meeting with the three ministers, said FNB spokesperson Patty Seetharam, reported City Press.
“Absa notes the minister’s comments and confirms that no meeting has taken place, nor has an invitation to a meeting been received as yet,” said an Absa spokesperson.
The publication went on to quote a source in the banking sector saying that there had been no contact between the banks and the ministers.
“It is an unprecedented move for the government to intervene in this way. This is creating a tricky situation,” the source said.
The DA’s David Maynier indicated in a statement that it’s a mistake for ministers to meet with South African banks, reported Fin24.
In his view the matter should be left to the South African Reserve Bank as the regulatory authority of the banking industry in South Africa.
“I’ve already requested the governor of the Reserve Bank, Lesetja Kganyago, to look into this matter.”
Maynier also requested that Kganyago investigate whether certain banks who had business relationships with the Guptas complied with all the relevant provisions of the Financial Intelligence Centre Act; and if the investigation determines that certain banks failed to comply, to order any appropriate remedial action or administrative sanctions.
For this story and more, read City Press.
