Following the provisional liquidation application for Ithala SOC Limited, the South African National Treasury has assured depositors that their funds will be protected by a government guarantee. This measure aims to alleviate concerns and ensure a fair distribution of available funds as Ithala faces closure due to insolvency.
In August 2024, Financial Sector Conduct Authority announced the suspension of Ithala’s licence as a financial services provider. File photo.The National Treasury has moved to assure the retail depositors of Ithala SOC Limited that their deposits will be protected by a government guarantee , subject to the conclusion of the necessary technical work.
The Prudential Authority, responsible for the prudential regulation of banks and insurance companies within the South African Reserve Bank , appointed a Repayment Administrator responsible for the repayment of deposits. In July 2022, the Prudential Authority issued a final exemption notice, which afforded Ithala a final opportunity to regularise its deposit-taking activities, warning that non-compliance would lead to the withdrawal of the exemption.
It said that the Repayment Administrator, appointed by the SARB, has established that Ithala is technically and legally insolvent, exposing depositors to potential loss of their deposits or parts thereof. The Prudential Authority said the National Treasury has written to it, advising that the government will guarantee their funds.
DEPOSITORS GOVERNMENT GUARANTEE LIQUIDATION ITHALA SOC LIMITED PRUDENTIAL AUTHORITY
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