VBS Mutual Bank curator Anoosh Rooplal says he has had to reduce all non critical costs in an attempt to align the bank’s cash inflows with its cash outflows.
He said in a statement on Thursday that cash expenses had been exceeding cash income earned by the mutual bank.
As a result‚ he had closed branches with low traffic‚ including the Thavhani‚ Johannesburg‚ Durban and the Sibasa branches. The two remaining branches‚ Thohoyandou and Makhado‚ had been reduced in size and would continue to service the loan account holders‚ whose contracts remained binding with VBS.
“The VBS head office has also been streamlined and staff have been moved into one office block to make more space available for potential new tenants. Unused and redundant assets will be sold and all proceeds will be to the benefit of the creditors of the bank‚ including municipalities‚ trade creditors and the remaining retail depositors who currently have over R100‚000 deposited in the mutual bank‚” Rooplal added.
As a necessary last resort‚ the salary costs of the mutual bank had also had to be reduced‚ with 94 people being retrenched‚ leaving the bank with 26 staff members.
“We have unfortunately had to reduce the staff compliment at the bank. This is always a tough decision and we have been comprehensive and transparent to all staff members in the process. We have followed an extensive consultation process as prescribed by the Labour Relations Act with the inclusion of the CCMA from the start‚” Rooplal said.