The Congress of South African Trade Unions (COSATU) commends Finance Minister, Enoch Godongwana, for his decisive intervention in ensuring that Ithala Bank is saved and no longer liquidated.

In January this year, COSATU in KZN, its vigilant Affiliate, the National Education, Health and Allied Workers Union (NEHAWU), along with Alliance partners, raised strong objections after the South African Reserve Bank’s Prudential Authority applied to have the state-owned Ithala provisionally liquidated.

Ithala is owned by the KZN Provincial government and in early 2025 was reported to be insolvent, prompting the Prudential Authority’s application for its liquidation. Strictly speaking, Ithala is not a bank as it does not have a banking licence but was granted a temporary exemption to accept deposits by the same Prudential Authority, with the expectation that in time it would comply with stipulated conditions and eventually be granted a licence. After renewing the exemption several times, and in reaction to the insolvency status, the authority decided to shutdown Ithala.

However, COSATU and NEHAWU objected mainly due to the more than 400 workers who would lose their jobs if the development finance agency closed its doors forever. The Federation was also concerned about the impact the closure would have on Ithala’s more than 257 000 depositors, who were workers and grant recipients.

It is with a sense of relief that COSATU welcomes the news that this institution that has been of service to the people of KZN will continue to do exactly that. The Federation also welcomes assurances by the provincial task team of the ANC in KZN that steps to ensure the viability and sustainability of Ithala will be implemented. It is critical that the Prudential Authority, Treasury and the KZN Provincial government work together to strengthen governance and internal controls, enhance compliance with banking regulations, and launch a turnaround strategy focused on accountability, transparency and performance.

The Federation is pleased the jobs at Ithala are will be safe and that the clients of this crucial institution will not become suddenly unbanked.

Issued by COSATU

Zanele Sabela (COSATU National Spokesperson)

Mobile: 079 287 5788 / 077 600 6639
Email: zaneles@cosatu.org.za