VBS creditors to get R670-million

VBS branch.

2 minutes

The VBS Mutual Bank liquidator’s office says it has managed to recover R670-million which will be paid to verified creditors. It says they include municipalities that had invested in the defunct institution.

Before the bank collapsed more than six years ago, 14 municipalities and thousands of clients had invested in it.

Louise Brugman, the spokesperson of the liquidator’s office, explains: “Through the liquidator collection efforts, a sum of R670-million will be paid back to verified creditors which include municipalities who invested in VBS, trade creditors and some 458 retail depositors who had over R100 000 in the VBS account.

They will effectively have recovered 25.6 percent of their monies once payments have been finalised. We believe that this recovery is a good outcome. The 13 municipalities that submitted a valid claim will be paid approximately R400-million,” says Brugman.

Meanwhile, Limpopo Co-operative Governance MEC Basikopo Makamu says the municipalities should spend the funds they will recoup on the delivery of basic services.

“Municipality like Vhembe, they got about R80-million; you will go to Fetakgomo Tubatse, they got about R58-million; you go to greater Giyani, they got about R10-million; you go to Lepelle Nkumpi, they get about R39-million. That makes the municipalities to recover and to get the income that they lost. I think the money should be channeled or redirected to service delivery or to resolve water projects.”