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A Ithala Bank stand at an event.
Government has assured retail depositors of Ithala that their money is protected in the process to winding the state-owned financial entity.
The Reserve Bank’s Prudential Authority has filed papers in the High Court in Pietermaritzburg for the provisional liquidation of the bank.
Ithala believes the move is in the best interests of about 257 000 depositors.
In a statement, National Treasury says the bank’s clients could soon see their funds and accounts migrated to a different financial institution.
Both Treasury and the Reserve Bank are working closely to ensure an orderly process that protects depositors’ interests.
The Administrator, appointed by the Reserve Bank, has found that Ithala is technically and legally insolvent, exposing depositors to potential loss of their deposits.
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