KZN premier Thami Ntuli calls for public, institutions to support Ithala

KwaZulu-Natal premier Thami Ntuli has called on the public and government institutions in the province to demonstrate their support for Ithala SOC (state-owned company) by using the institution to ensure its protection and revitalisation.

He said this would ensure that the beleaguered financial entity continues its “distinct role” of providing financial services even to rural and underserved communities in the province.

Ithala has not been trading since January 16 when repayment administrator (RA) Johannes Kruger, acting on behalf of the Reserve Bank’s Prudential Authority, lodged a court application for it to be liquidated, citing insolvency and regulatory noncompliance. That left Ithala unable to access the revenue it generated, and depositors had not been able to access their funds.

The entity has since received enormous support within the province; from King Misuzulu and traditional leaders, different political and civil organisations to the public, an act which Ntuli acknowledged during a press briefing in Durban on Wednesday.

“We have witnessed an inspiring unity of purpose — a rare and powerful alignment of voices across political lines, within and beyond our provincial legislature. We have seen principled demonstrations and courageous statements issued by various political formations, affirming that Ithala is not merely a financial institution, but a matter of public interest and provincial pride,” he said.

Ntuli was speaking on the latest developments on Ithala after Friday’s judgment which permitted the institution to resume partial operations even though the RA is appealing that ruling.

The bank is not permitted to resume its deposit-taking activities but can carry on other functions like its insurance services and it has made arrangements for its clients to be able to pay instalments.

This then calls for those who have been supporting the entity over the past four months to put their money where their mouths are.

“Your voices have not only been heard — they have carried weight. They have reminded us that Ithala is not just a bank, but a beacon of our collective struggle for economic justice and dignity,” Ntuli said.

“Let us translate our support into action. Let us mobilise our communities, institutions and businesses to open accounts with Ithala. Let us stand not as passive observers, but as active participants in the rebuilding of this essential institution.

“It is through such solidarity that we will restore Ithala to its rightful place — as a cornerstone of financial inclusion, economic empowerment and provincial pride.”

He called on provincial government departments and municipalities to lead the way by banking and transacting with Ithala.

“I call upon all municipalities and provincial departments across KwaZulu-Natal to demonstrate tangible support for this institution. Let us move beyond symbolic gestures. Let us lead by example.”

Ntuli said Ithala’s efforts towards economic inclusion in the province, highlighted by its unique reach to communities who had been “historically excluded” from the mainstream financial sector and its impact on entrepreneurship, makes it the pride of the province that should be preserved to enable the provincial economy to grow.

“By choosing to bank with Ithala, we are not merely supporting a financial institution, we are investing in a more inclusive and equitable economy. We are backing a bank that knows our people, that serves in isiZulu, that reaches rural villages and townships where no commercial bank dares to go.”

Ntuli added that he was not putting people’s finances at risk with his call to bank with Ithala despite the uncertainties facing it, insisting that their money is safe with the institution.

“At no stage will they lose their money. What is important is the preservation of the institution, not only for the money that is with them but for the economic growth of the province because Ithala is a distinct institution when it comes to the conditions that are there for people who needs support.

“It’s our hope as a province that we can see better growth in our economy if Ithala is active; supporting those who are emerging entrepreneurs and those expanding their businesses. There’s no risk, therefore, for them to keep their money with Ithala.”

Ithala CEO Dr Thulani Vilakazi reiterated that the institution's current assets exceeded its liabilities by R356m, which he said negated the claim that it was insolvent.

He believes that the manner in which the matter was dealt with by the RA was “tantamount to trying to put Ithala out of existence”.

He said that it was wrong to prevent the bank's clients from receiving salaries and social grants as well as making instalments because those did not qualify as deposits.

Vilakazi added that despite Friday’s judgment, it does not mean they can start offering over-the-counter services because it has been appealed by the RA and PA but said he was confident that the courts would once again favour them as it has done so on two occasions in this matter already.

He warned that it would take some time to resume deposit-taking operations even when they had received the go-ahead.

“We anticipate that it will take three to six weeks before we’re able to service the first customer, not because we’re unable to do so but due to what is required for us to validate everything.”

Ntuli said appealing Friday’s court ruling shows that the Reserve Bank, through the PA and RA, are “are adamant in destroying Ithala”.

“We are hopeful we will save Ithala, not for ourselves but for the people of this province because it is an institution that has yielded an important hope to the future of our economy.”

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