THE UNFINISHED STORY – THE RESERVE BANK BAILOUT OF THE BANKORP GROUP AND ABSA: PART 2
This is Part 2 of a paper on the fabled “lifeboat” or “bailout” afforded by the SA Reserve Bank to the Bankorp Group and Absa Bank between 1985 and 1995.
As pointed out in Part 1 of the paper, this bailout has been the subject of three investigations:
the Special Investigating Unit (“the SIU”), led by Judge Willem Heath, following a proclamation by President Thabo Mbeki, which concluded that the SA Reserve Bank R1.5 billion bailout of the Bankorp Group and Absa Bank was a “simulated transaction” – a gift disguised as a loan. That Report was never released by President Mbeki or any other President after him.
the Davis Panel of Experts, led by Judge Dennis Davis, appointed by Mr Tito Mboweni – then governor of the Reserve Bank and now Minister of Finance – which reached the same conclusion as the SIU as regards the “simulated” nature of the bailout.
the Public Protector who found likewise and went further to direct that the money be recovered from Absa Bank and other beneficiaries.
In this Part 2, we discuss the findings and recommendations of the three investigations and propose the way forward with reference to Constitutional Court authority.