SA Reserve Bank to challenge Public Protector's findings in court

On Monday, Public Protector Busiswe Mkhwebane said that the bank had failed in its duties to protect the public by not ensuring that Absa bank repaid an apartheid-era bailout given to failed bank Bankorp.

FILE: Reserve Bank Governor Lesetja Kganyago. Picture: Renart Toerien/EWN.

JOHANNESBURG - The Reserve Bank has just given its first formal response to the findings of the Public Protector, saying that it's going to court to have her findings reviewed.

On Monday, Public Protector Busiswe Mkhwebane said that the bank had failed in its duties to protect the public by not ensuring that Absa bank repaid an apartheid-era bailout given to failed bank Bankorp.

But she also said the mandate of the bank's monetary policy should change and that it should no longer focus on protecting the value of the currency.

The Reserve Bank now says it believes that her remedial action is unlawful and out of the scope of her powers and that it will challenge the findings in court.

The matter relates to funds misappropriated during the apartheid era and given as a lifeboat to Bankorp, which was later purchased by Absa bank.

Mkhwebane found the government failed to recover the funds.

"Whether the South African government and the South African Reserve Bank improperly failed to recover Absa/Bankorp an amount R3.2 billion cited in the CIEX report, the allegation is substantiated. The correct amount of the illegal gift granted to Bankorp or Absa is in an amount of R1.2 billion."