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Reports: Denmark’s Jyske Bank withdrawns financial support for Eskom

The bank raised concerns in relation to governance shortly after Futuregrowth's move to do the same.

Picture: Reinart Toerien/EWN.

JOHANNESBURG/CAPE TOWN - Bloomberg is reporting that Denmark's Jyske Bank has withdrawn financial support for Eskom citing concerns over governance.

It this has been confirmed in email comments sent to the news agency.

Yesterday, asset manager Futuregrowth announced that it had withdrawn its financial support for six state-owned entities, including Eskom, Sanral, Transnet, The Land Bank, the IDC and the Development Bank.

It raised concerns in relation to governance and decision-making at these institutions.

In response, the African National Congress has said that the company's statements are erroneous and unfortunate.

The party's Khusela Sangoni said, "We believe Futuregrowth should be engaging with the relevant ministries and parastatals to get to the bottom of their concerns and together find a solution that works in the interests of the economy. We do, however, want to reiterate our commitment to ensuring that the SOEs perform their developmental role in this country."

Eskom's Khulu Phasiwe says at the moment the parastatal has secured more than half of the funding required for this financial year.

"Our plan was to raise about R50 billion this year and we have raised over 57 percent of what we need. Therefore, currently we don't have any trepidation."

But he says Eskom won't take Futuregrowth's decision lightly and will continue engagement with the wider investment community.

"We will be going back to the market to make sure that we explain to them anything that they may be feeling unhappy or uncomfortable about and we will clarify those matters."

While the power utility hasn't confirmed the withdrawal of a second money manager, it says its confident the necessary funding for the year will be raised.

Earlier, Deputy President Cyril Ramaphosa said processes were underway to ensure that tensions at upper levels of government were being resolved.

He was answering questions in Parliament on a variety of issues including the economy.

"It is the statements that also exacerbate the situation and we'd like to believe the processes that are underway to deal with this matter, will put this matter to bed and we will be able to proceed forward in a way where there is decorum."

Earlier, economist Dawie Roodt questioned whether other financiers would follow Futuregrowth's example.

Roodt said the public announcement by Futuregrowth was a "bold move".

"A private asset manager decided and made it public, and I think that was a very brave move, that we are not going to fund the state anymore and lend money to the state anymore. So is somebody else going to follow? See what happened with the banks and Oakbay for example."

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