By Lebone Rodah Mosima
The KwaZulu-Natal Treasury said on Tuesday that more than R1.7 billion of the R2.1 billion owed to Ithala SOC Limited depositors has been paid since December, as provincial and national authorities work to finalise outstanding legal agreements by 30 June.
KZN Finance MEC Francois Rodgers and Treasury head Carol Coetzee met Finance Minister Enoch Godongwana, South African Reserve Bank Deputy Governor Fundi Tshazibana and Financial Sector Conduct Authority commissioner Unathi Kamlana in Pretoria last week.
The talks focused on delays in concluding agreements regarding Ithala, including depositor repayments and the settlement of the government guarantee.
“We are encouraged by the significant strides made in repaying Ithala depositors and the strong collaboration among all stakeholders. Our focus remains on ensuring that all legitimate depositors receive their funds as quickly as possible, while upholding strict governance and accountability,” Rodgers said.
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The update follows National Treasury’s December announcement that it would make up to R2.2 billion available to repay Ithala depositors, with First National Bank appointed to facilitate payouts from 8 December after client verification. Depositors have until 2028 to claim their funds.
KZN Treasury said the current agreement between National Treasury and FirstRand Bank Limited gives depositors a three-year claim period, but the provincial government wants clients to visit their nearest FNB branch with the required documents to help conclude the process sooner.
In January 2025, the Prudential Authority applied to the Pietermaritzburg High Court for the provisional liquidation of the entity after the repayment administrator found it to be technically and legally insolvent.
The Prudential Authority later said in its 2024/25 annual report that efforts to transfer Ithala’s deposit-taking activities to a registered bank had been hindered by a lack of interest from registered institutions and cooperation from Ithala.
In February, the KZN government said the Prudential Authority and repayment administrator Johan Kruger may withdraw the liquidation application.
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Treasury said the meeting last week agreed that Kruger’s role would be reviewed by the Prudential Authority because of the “back-to-back agreements” constructed by the province.
It said the review was needed to allow the provincial government to meet its contractual obligations under its agreement with National Treasury.
