South Africa’s Oakbay “implores” banks to reopen its accounts

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South Africa’s Oakbay “implores” banks to reopen its accounts

5:51 CAT | 08 Sep 2016

ATUL GUPTA PHOTO: AP/SIPA

Oakbay Investments said on Thursday it will again try to restore its relationships with South African banks which ostracised it after allegations of undue political influence by its owners, the Gupta family.

Oakbay’s announcement comes weeks after its owners said they planned to sell all of their stake in the local business before the end of the year.

“We intend to reach out in the coming weeks, again, to the four banks, and implore them to reopen our account,” Chief Executive Nazeem Howa said after releasing annual results.

The Indian-born Gupta brothers, whose businesses stretch from media to mining, are friends of South African President Jacob Zuma. They have denied using this friendship to influence his decision-making, including cabinet appointments, or advance their business, saying they are pawns in a plot to oust Zuma.

Zuma has confirmed that the Guptas are his friends, but has denied allegations that they wield undue political power.

The president set up a three minister-committee to patch up relations between Oakbay and the four banks — FirstRand, Barclays Africa, Nedbank and Standard Bank — but this has made little headway.

The banks have not given reasons for closing the company’s bank accounts between December and April, citing client confidentiality agreements.

Lenders have consistently declined to comment, but FirstRand chief executive Johan Burger said on Thursday his bank had nothing to hide after Mines Minister Mosebenzi Zwane said last week that the inter-ministerial team had asked Zuma to launch a judicial probe into why the banks cut their ties with Oakbay.

“Cabinet said there is no such thing. And why would we be concerned? We have nothing to hide,” Burger said.

Zwane was castigated last week by opposition parties for saying cabinet was behind the team’s proposal to urge Zuma to set up the inquiry.

Finance Minister Pravin Gordhan, part of the inter-ministerial team, also distanced himself from Zwane’s comments on Thursday, saying a judicial inquiry into the banking sector was not necessary.

Privately-owned Oakbay reported a 7% increase annual sales to 2.6bn rand ($186m) in its first public earnings report. Howa said the earnings had been published to “dispel some of the myths” about the company.

“I look forward to dispelling the myth that our Group is heavily reliant on Government business, either directly or indirectly. Nothing could be further from the truth,” he said.

Government contracts accounted for 9% of the company’s sales, Howa added.

Source: theafricareport