The Umkhonto Wesizwe Party (MKP) has thrown down the gauntlet to Finance Minister Enoch Gondongwana, urging him to step in and prevent the potential liquidation of Ithala Bank.

The political party also called for Ithala Bank to be left alone amidst its ongoing legal dispute with the South African Reserve Bank's Prudential Authority.

The demands were made during the party's protest march outside the central bank's office in Pretoria on Monday.

The Prudential Authority has been seeking to provisionally liquidate Ithala Bank, citing concerns over its financial stability and compliance with banking regulations.

Ithala Bank, on the other hand, has maintained that it is financially stable and has been unfairly targeted by the Prudential Authority, which has petitioned the Pietermaritzburg High Court for the bank's provisional liquidation.

MKP caucus chief whip in Parliament Mzwanele Manyi said: “This is where we are saying to the Minister (Godongwana) that he is empowered by Section 1(1)(cc) of the Banks Act to make all kinds of exemptions. Why are you not using that power? Even if the Prudential Authority has got certain rights, you also have to concur. Why are you concurring with stringent measures that are actually undermining the development of Ithala Bank?” he said.

He also penned a letter to Gondongwana in which he expressed deep concern regarding the impending liquidation of Ithala Bank, also stressing that the minister has the power to rectify the situation.

“The Standing Committee on Finance in Parliament has made it clear that it does not support the closure of Ithala Bank. This position is a recognition of the bank’s strategic importance in providing financial services to underserved communities and supporting economic development in KwaZulu-Natal. Given this, it is difficult to understand why the National Treasury has failed to act decisively to safeguard Ithala’s future,” he said.

Speaking to supporters outside the Reserve Bank, Manyi vowed that the party will organise nationwide protests if authorities do not halt the liquidation process of Ithala Bank and secondly, if the bank is not granted a commercial banking license.

“We can’t have a situation where a well-run bank like Ithala Bank is now just being undermined because of some technicalities, as it were. We are not dealing here with a bank that has got corruption. We are dealing here with a bank that has got a liquidity problem. There are no issues. They just found technicality to make life impossible,” he said.

Mpho Marolane, MKP Tshwane regional organiser, said the political party advocates for the nationalisation of the Reserve Bank.

“Some of the draconian postures that you see is as a result of the ownership make-up of the Reserve Bank. We will continue advocating for the nationalisation of the Reserve Bank. I think in this continent the Reserve Bank is the only central bank that is not owned by the State,” he said.

He said if the State was in charge of the bank there would 'not be opportunities for the capitalists to liquidate Ithala'.

The party submitted its memorandum of demands to Mahlatse Mahlase, from the communications division at the Reserve Bank, who promised to escalate their demands to her superiors.

In recent times, several organisations and political parties, including the MKP, the ANC, and the DA have expressed support for Ithala Bank in its efforts to avoid liquidation.

Mike Mabuyakhulu, head of the newly-reconfigured ANC in Kwa-Zulu Natal, recently expressed concern for the bank's more than 250,000 customers affected by the impending liquidation.

On the other hand, the Inkatha Freedom Party (IFP) called on the Prudential Authority to stop all efforts to liquidate Ithala Bank, also pushing for the entity to receive a banking license, enabling it to become a fully-fledged State Bank.

King Misuzulu KaZwelithini recently convened an Imbizo, where he voiced his frustrations over the attempted shutdown of the bank, alleging that a "third hand" is involved in the matter.

rapula.moatshe@inl.co.za

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MK Party defends Ithala Bank amid legal dispute