The leaked report from the current Public Protector on the loan between Bankorp and the South African Reserve Bank has caused a stir.
The deal dates back to 1985 when the Central bank bailed out Bankorp, which has since been acquired by ABSA.
The leaked report recommends that ABSA pays back a sum of R2, 2 billion.
In 2002, a panel that was appointed to investigate the Reserve Bank’s role, found that the SARB had acted outside its authority, even though there was no evidence of intentional dishonesty.
Speaking on Morning Live, Head of the School and Economic Business Sciences at Wits Jannie Rossouw says the bail out of Bankorp started in 1985 and continued to 1994.
“It was a period of nine years, which was considered a long period. Bankorp did not disclose the full extent of its problems to the Reserve Bank.”[Source: SABC]