Cabinet agrees to intervene in Gupta-banks matter

SA’s biggest banks took the decision to cut ties with the company over potential 'reputational risk'.

Atul Gupta. Picture: AFP.

CAPE TOWN - Cabinet has agreed that the ministers of finance, labour and mineral resources should meet with the four banks that have cut ties with the Gupta-linked company, Oakbay investments.

Minister in the Presidency, Jeff Radebe, made the announcement while briefing media on the outcomes of last week's Cabinet meeting.

Absa, FNB, Nedbank and Standard Bank as well as Safin and auditing firm KPMG, have stopped services to Oakbay investments, which holds assets for the family, including the New Age newspaper, TV channel ANN7 and Sahara computers.

The country's biggest banks took the decision to cut ties with the company over potential "reputational risk".

The minister says Cabinet believes their action may deter potential investors wanting to do business in South Africa.

"Cabinet 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."

Radebe dismissed suggestions that the move could be seen as an attempt by the government to bully the banks into submission over their decision not to do business with controversial Gupta family.