Court orders liquidation of VBS Mutual Bank
The High Court in Pretoria has ordered the liquidation of VBS Mutual Bank.
PRETORIA - The High Court in Pretoria has granted the Prudential Authority’s application to liquidate the VBS Mutual Bank.
The application follows Advocate Terry Motau’s finding of widespread looting at the bank and his recommendation that it should be wound up because it simply cannot be rescued.
The forensic report revealed an estimated R2 billion in deposits, many from municipalities, were stolen.
Advocate Vincent Maleka told the court that the Prudential Authority’s application to liquidate the bank was not being opposed.
Minutes later the application was granted and means the bank will now be wound up and closed.
The authority had argued that VBS is unable to pay its debts and is commercially insolvent. It is further factually insolvent in that its liabilities exceed its assets.
It was further submitted that there is no reasonable probability that the continuation of the curatorship will enable VBS to pay its debts or meet its obligations and become a successful concern.
However, now that the bank is being wound up, it will enable a liquidator to use legal mechanisms to recover funds from recipients where transactions were found to be void or impeachable.