Over 380 Ithala Bank employees across 38 branches in KwaZulu-Natal are celebrating a return to work following a landmark decision by the Pietermaritzburg High Court that allows the embattled, black-owned financial institution to resume operations.
On May 9, Judge Muzi Ncube ruled that Johannes Kruger, the repayment administrator appointed by the Prudential Authority (PA), had no legal authority to take control of Ithala’s daily operations. This judgment comes as Ithala challenges an ongoing liquidation application that resulted in the freezing of all customer accounts earlier this year.
Employees and Communities Rejoice
The ruling has been met with relief and celebration by employees and communities who rely on the bank for financial services and livelihoods.
“I’m just happy to be working again,” said Sibusiso Mkhize, a staff member at the KwaMnyandu Mall branch in uMlazi. “We’re hopeful the matter will be resolved quickly. For now, I’m just grateful.”
Samuel Mathe, based at the Pietermaritzburg branch, echoed the sentiment:
“We thank everyone fighting to save the bank. These jobs mean everything in today’s tough economy. We just want to work and serve our clients.”
Both employees extended gratitude to community members, political leaders, and advocacy organisations who mobilised to save the institution from collapse.
Government Applauds Ruling
KwaZulu-Natal Premier Thamsanqa Ntuli welcomed the ruling, calling it a “lifeline” for thousands of stakeholders:
“On behalf of the provincial government, we are pleased with the High Court’s decision. This brings much-needed relief to clients, employees, and suppliers who suffered when transactions were halted under the administrator.”
Legal Battle Far from Over
Although Ithala has been allowed to operate while its appeal is underway, the battle is not over. In its court filings, the Prudential Authority claimed Ithala was technically and legally insolvent, referencing Section 83(3)(b) of the Banks Act, citing its failure to repay depositor funds.
Ithala, however, is challenging this claim, arguing that the PA’s actions were premature and unlawful, and has vowed to continue defending its operational legitimacy.
Political Backing Grows
The embattled bank has received cross-party political support, with the IFP, ANC, EFF, and uMkhonto weSizwe Party (MKP) publicly backing its continued existence. Their support highlights the institution’s socioeconomic role in serving black communities and promoting financial inclusion in KwaZulu-Natal.
What’s Next?
- Ithala resumes full banking operations immediately.
- The PA’s liquidation attempt remains under legal review.
- The community, government, and stakeholders await the next round of court proceedings with cautious optimism.
