Pietermaritzburg (Prudential Authority (PA), a regulatory body within the Reserve Bank of South Africa), has announced that it has begun an application for leave appealing the decision, taking note of a recent ruling by J. Ncube of the Pietermaritzburg High Court.
On Friday (May 9, 2025), the court upheld Isara following a dispute over the authority of Johann Kruger, who took over the operation of the bank, which took over the operation of the bank after being appointed after the court's appointment.
The PA said the RA would also file an appeal against the ruling.
“It is important to note that in any case, the RA complies with the court's previous order to not control Ithala Soc Limited (Ithala)'s non-deposit contract business,” the PA said.
“However, the RA was unable to isolate depositor funds from other funds because Isara has not maintained a separation between its deposit activities and other operations.
“It is also important to emphasize that this ruling is separate from the major liquidation applications still pending before the same court.”
The PA said it awaits finalising the liquidation application and claims its main mission is to protect depositors.
“In this context, PAs understand the frustration and difficulties that this situation can cause for depositors, but account freezes remain a necessary and wise step to protecting the depositor's remaining funds,” the PA said.
“The measure is intended to ensure a fair and legitimate distribution process of depositor funds while awaiting the results of the liquidation application.”
Further context regarding the liquidation procedure against Isara can be accessed on the SARB website here.
