The Banks Amendment Act came into operation on Monday, 29 June 2015. The Amendment Act looks slightly different to the draft bills that were circulated towards the end of 2014. Input from the Standing Committee on Finance has now been incorporated.
The Amendment Act provides for the curator of a financially distressed bank to create a successor entity and to dispose of all or a part of the business of the bank to the successor entity. Stakeholders will be relieved to see that any administrative action taken (including the steps and decisions taken by the curator) can be taken on review in terms of the Promotion of Administrative Justice Act 2000. A curator of a troubled bank performs a public function capable of review under PAJA.
This will be important for any creditors who feel they are not treated in an equitable manner when the curator deals with their arrangements as with ABIL.