Absa’s Bankorp scandal:
Apartheid-era looting and the lesson for today
The leaked report from the office of the Public Protector into Bankorp’s unlawful SARB bailouts and apartheid-era looting by monopoly capital should serve as a wakeup call.
These crimes, decades old and yet to go unanswered, continue to this day. The same wealthy families that controlled the economy at the end of apartheid are the same families that control the economy now. And their tight grip on South Africa’s wealth is actively excluding South Africa’s majority black population from participating in the economy.
The leaked report from the Public Protector suggests Absa could be forced to pay R2.25 billion to the country for an “unlawful” apartheid-era bank bailout of Bankorp Limited, a bank that was acquired by ABSA in 1992.
The matter has its roots in a 1997 investigation by Ciex, a British company headed by a former UK spy Michael Oatley. Oatley reportedly approached the South African government to investigate and recover public funds and assets allegedly misappropriated during the apartheid era.
Take a closer look at Oatley’s report, and there is a string of other alleged illegal beneficiaries of state funds prior to 1994. It will also come as no surprise that one of them is Rembrandt Group, owned by billionaire Johann Rupert’s, leader of the Stellenbosch mafia and the man that epitomises monopoly capital in our country.
Sanlam, Nedbank and First National Bank have also been named as possible targets for repayment claims in the Ciex report.
The true extent and findings of the report are yet to be fully revealed, but what the leaked report is already shining light on, is that post-apartheid not much has changed in South Africa’s banking sector.
The faces of the bankers behind the counters in your local bank might be black, but the bankers and decision makers in the board room, and the highly paid investment bankers who help to fund the dreams and growth of many corporates in our country, are largely white.
While the monopoly ownership of these banks remains problematic because black South Africans are being alienated by South Africa’s banking community.
Young black entrepreneurs, inspired by the internet and rise of e-commerce, many who have dreams of owning their own businesses, too often find that when they approach the country’s leading banks, their dreams are dashed when they are refused a loan.
Whilst statistically it is very difficult to uncover the true extent of discrimination in the provision of financial services, and specifically business loans to young black entrepreneurs, this paper hears too many stories of aspiring black business men and women repeatedly having loan applications turned down, denying them the opportunity to contribute to the economy.
Black South Africans lack the financial levers to fulfil their potential. This has to change. The banking community needs to do more to support black entrepreneurs and their ambitions.
South Africa’s banks should look to Ghana where banks, such as Affinity, have been specifically set up to support entrepreneurs – its mission statement? ‘For Entrepreneurs. For SMEs. For Ghana’.
South Africa’s banking community should take note and wake up to what young black entrepreneurs in could contribute if they were given half a chance.