The South African Government has now realised that it is not good for investment if banks can make collusive decisions that kill businesses. _____
Many different news outlets Cabinet intervenes in Gupta account debacle Chantall Presence, African News Agency, IOL, 21 April 2016 Parliament - Cabinet endorsed the establishment of an inter-ministerial committee to investigate the decision by the country's major banks to cut ties with Gupta-owned Oakbay Investments, Minister in the Presidency Jeff Radebe said on Thursday. During a media briefing outlining decisions made during last week's fortnightly Cabinet meeting, Radebe said cabinet was concerned that the decision could scare off investors. "Cabinet noted the action by the four banks that gave notice to close the bank accounts of the company," Radebe said. "The actions deter future investors who may want to do business in South Africa." Radebe said the ministers of finance, mineral resources and labour have been tasked with setting up a meeting with the banks to "open constructive talks to find lasting a solution". The minister denied that this could be seen as government interference in the private sector or bullying. "No, that is why the team of ministers would be interacting with banks to find out the facts." Oakbay has complained that the closure of bank accounts could lead to thousands of job losses at the company. The closure of the bank accounts follows allegations by, among others, Deputy Finance Minister Mncedisi Jonas, that the Guptas had offered him a promotion prior to Nhlanhla Nene being fired as finance minister last year. From: http://mini.iol.co.za/business/companies/cabinet-intervenes-in-gupta-account -debacle-2012775 Three ministers step in for Gupta company over banks saga News24Wire, Business Tech, 21 April 2016 Jeff Radebe, Minister for Planning, Monitoring and Evaluation, opened a can of worms on Thursday when he said three cabinet ministers held meetings with South Africa's four big banks to get reasons why they decided to close the bank account of the Gupta-owned Oakbay Investments. Mines Minister Mosebenzi Zwane, Labour Minister Mildred Oliphant and Finance Minister Pravin Gordhan met with the banks to find out why they don't want to have a certain company as their client, Radebe said. He said Cabinet is concerned that this move could deter future investors who want to open South African bank accounts. "Cabinet noted the actions by the four banks that gave notice to close the bank account of a company," he said. "Whilst Cabinet appreciate the terms and conditions of the banks, the acts may deter future potential investors who may want to do business in South Africa. "Cabinet has endorsed that the ministers of Finance, Labour and Mineral Resources should open a constructive engagement with the banks to find a lasting solution to this matter." The move comes as Oakbay announced it had found a new auditor - SizweNtsalubaGobodo - after KPMG cut ties with all Gupta-owend companies in April. KPMG was joined by the top four banks and Oakbay's JSE sponsor Sasfin Capital, who revealed they were cutting ties or had given notice to do so in March. Oakbay Investments CEO Nazeem Howa told staff in the letter that the closure of its bank accounts "made it virtually impossible to continue to do business in South Africa". "Without bank accounts we may find ourselves in a position where we are unable to pay you, our valued employees," he said. "We are doing everything in our power to ensure this does not happen. "We find it totally unacceptable that you, our employees, and your families could potentially have to suffer as a result of the political campaign against us." Oakbay has been trying to keep the focus on the 7 500 jobs at risk at Oakbay, while their owners - the Guptas - resigned from all positions and jumped on a plane to Dubai with a plane filled with suitcases. In the meantime, Oakbay has managed get approval for its acquisition of Optimum coal mine from Glencore this month, paying R2.15 billion to clear its debt. During question time Radebe had to field a barrage of questions from journalists about the perceived "interference" of cabinet into the private sector. One journalist asked Radebe how government could justify meddling in the affairs of banks, suggesting it came down to "bullying". "Will you do the same for any other small business who has a problem with the banks?" Another asked him if it's "wise" to have Mines Minister Zwane as part of the delegation, given allegations of an untoward relationships with the Gupta family who owns Oakbay. Radebe side-stepped the question about Zwane's involvement, and merely said: "Yes, he is part of the delegation." As for cabinet's perceived bullying of banks, he responded: "The banks are big boys and girls and there can never be any bullying where they are concerned." He maintained that the three ministers' "interaction" with the four banks were "normal". "Government and the private sector meet all the time. There is nothing extraordinary about this." From: http://businesstech.co.za/news/business/121233/three-ministers-step-in-for-g upta-company-over-banks-saga/ Cabinet Agrees to Intervene in Gupta-Banks Matter Gaye Davis, Eye Witness News, Cape Town, 21 April 2016 Cabinet has agreed that the ministers of finance, labour and mineral resources should meet with the four banks that have cut ties with the Gupta-linked company, Oakbay investments. Minister in the Presidency, Jeff Radebe, made the announcement while briefing media on the outcomes of last week's Cabinet meeting. Absa, FNB, Nedbank and Standard Bank as well as Safin and auditing firm KPMG, have stopped services to Oakbay investments, which holds assets for the family, including the New Age newspaper, TV channel ANN7 and Sahara computers. The country's biggest banks took the decision to cut ties with the company over potential "reputational risk". The minister says Cabinet believes their action may deter potential investors wanting to do business in South Africa. "Cabinet endorsed that the ministers of finance, labour and mineral resources should open a constructive engagement with the banks to find a lasting solution to this matter." Radebe dismissed suggestions that the move could be seen as an attempt by the government to bully the banks into submission over their decision not to do business with controversial Gupta family. From: http://ewn.co.za/2016/04/21/Cabinet-agrees-to-intervene-in-Guptabanks-matter South Africa sets up cabinet team to resolve Oakbay, banks standoff Reuters, Cape Town, 21 April 2016 South Africa has set up a team of ministers to resolve the stand off between banks and Oakbay Investments, the Minister in the Presidency Jeff Radebe said on Thursday. Oakbay Investments was ostracised by all four major banks in recent weeks amid allegations that its owners, the Gupta family, had undue political influence with President Jacob Zuma. (Reporting by Wendell Rolef; Writing by Tiisetso Motsoeneng; Editing by James From: http://af.reuters.com/article/topNews/idAFKCN0XI1AQ Cabinet concerned banks dropping Guptas could deter investment in SA Linda Ensor, Business Day, Johannesburg, 21 April 2016 The Cabinet is concerned that the action of the major banks in severing relationships with Gupta-associated family businesses could deter investors from investing in the country. In the last two weeks, FNB joined Absa, Sasfin Capital and auditing firm KPMG in cutting ties with the Guptas' listed company, Oakbay Resources & Energy. The move to close the bank accounts came amid allegations that the Gupta family had improper influence over President Jacob Zuma. Minister of Planning, Monitoring and Evaluation Jeff Radebe said at a post-cabinet media briefing on Thursday that the Cabinet had asked Finance Minister Pravin Gordhan, Labour Minister Mildred Oliphant and Mineral Resources Minister Mosebenzi Zwane to discuss the matter with the banks. Mr Radebe was questioned on whether this decision by Cabinet did not constitute interference by the state in the decisions which banks have taken on the basis of their risk assessments and prudential banking. He said this was not interference as the ministers had been asked to engage with the banks to understand what their reasons were for their decision. He stressed that the three ministers would meet the banks in an information-gathering exercise. The minister was grilled by journalists about the appropriateness of the Cabinet decision in the light of the investigation by the African National Congress into state capture and the allegations that President Jacob Zuma has close relationships with members of the Gupta family. Journalists also wanted to know whether it was appropriate for Mr Zwane to be included in the team, given the allegations of his close relationship with the Guptas. Mr Radebe also rejected the suggestion that the banks were being bullied, saying that this was a "normal interaction". "The interaction between government and business happens all the time. Whether it happens in the future depends on whether there is a query," Mr Radebe said. The minister was also asked whether the decision meant that any business whose bank account was closed could approach Cabinet to intervene. On Wednesday African National Congress Youth League (ANCYL) president Collen Maine was jeered after he tried to reason with Oakbay employees who were unhappy with the letter sent out to banks on their behalf pleading for them to reopen the company's accounts. Earlier this month, in a letter to staff, Oakbay Investments CEO Nazeem Howa said the closure of the bank accounts has made it "virtually impossible to continue to do business in South Africa", indicating he was hoping to restore services. On Friday, the African National Congress Women's League (ANCWL) said women and children would be the "victims" of the "colluding tactics of financial institutions" who are refusing to deal with Oakbay Investments. The league stressed that it was not the "spokesperson" of the Gupta-linked group, but was concerned about the "livelihood of dependants of the workers of the company who are in the main unemployed women and children whose husbands'/fathers'/guardians' income security is threatened". "Therefore the ANCWL will not be on the sidelines to watch the financial monopolies waging cold war against SA's women and children," Women's League secretary-general Meokgo Matuba said. The Congress of SA Trade Unions (Cosatu) also accused auditing firm KPMG and three of the country's big four banks of "political posturing" for unexpectedly cutting ties with Gupta-owned businesses and shutting down their bank accounts. "The decision by Absa, FNB, Nedbank, Sasfin and KPMG to stop doing business and associating with the Guptas is nothing but political posturing," said Cosatu spokesperson Sizwe Pamla. From: http://www.bdlive.co.za/business/financial/2016/04/21/cabinet-concerned-bank s-dropping-guptas-could-deter-investment-in-sa -- -- You are subscribed. This footer can help you. Please POST your comments to [email protected] or reply to this message. 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