NEWS

Stop Banking With Absa, The ANCYL Tells Government

Don't trust these institutions to direct the economy, says the ANCYL

19/01/2017 00:49 SAST | Updated 20/01/2017 19:49 SAST
Siphiwe Sibeko / Reuters

The ANC Youth League will intensify calls for the government to stop banking with Absa bank, it said on Wednesday.

"We will continue to take strong political action and radical campaigns to have the government withdraw its accounts from Absa, just as we pursue them to repay the money that they are holding onto," league spokesperson Mlondi Mkhize said in a statement.

It was reacting to the contents of a leaked draft document from the Public Protector's office last week.

In 2012, then Public Protector Thuli Madonsela began investigating the government's alleged failure to recover billions of rands the apartheid-era administration had borrowed to Bankorp. Absa acquired Bankorp in 1992.

Madonsela's successor Busisiwe Mkhwebane took over the report. A draft version was leaked last week. It contained a recommendation that Absa repay R2.25bn to the fiscus. The bank said on Friday that this was regrettable.

Madonsela's report followed an investigation by former British spy Michael Oatley in 1997. He probed claims that the Bankorp group of banks was offered a R1.5bn State bailout before the dawn of democracy. His findings became known as the Ciex report.

The ANCYL said it noted the seriousness of the revelations about alleged criminal conduct at financial institutions, including the role of ratings agency Moody's, in causing the 2008 financial crisis.

"South Africans must no longer trust these institutions in determining the state of our economy and the political choices that we should make," Mkhize said.

Their "immorality" should be rejected, he said. The money pumped into Absa during the dying days of apartheid was an example of the "systemic looting of public resources by white private capital".

"The ANC Youth League calls for the release of the report that we believe was intentionally hidden. Government must speedily start a process to recoup all amounts of money that will emerge in that trail."

The league said banks' "racialised extortion" of the public needed further debating. Access to loans, housing bonds and car finance was based on a credit risk assessment model that ensured black youth paid the highest interest rates, Mkhize said.

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