Curator says 70% of Habib Overseas Bank depositors will get to withdraw all their funds

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The curator of Habib Overseas Bank (HOB) has said that an estimated 70% of the bank's eligible depositors will be able to withdraw all their funds under a payment scheme announced this week. 

This means that roughly 1 300 of the bank's 1 900 deposits will get all their money out. 

The struggling bank, which has five branches in SA and about 90 employees, was placed into curatorship in late March by Minister of Finance Enoch Godongwana.

READ | Finance minister places Habib Overseas Bank into curatorship to protect depositors

Earlier this week, SA Reserve Bank (SARB) announced that HOB depositors would be able to withdraw up to R100 000 from their accounts from next week. 

First National Bank was chosen as the payout institution for the funds. Customers will have up to three years within which to claim their funds.

The bank's curator, Craig du Plessis of PwC, said on Friday that FNB had received the funds from the SARB to process payments to eligible depositors. 

Du Plessis said depositors will only be able to withdraw up to R100 000 but will retain claims for the balance of what they are owed. 

Depositors with a balance of R100 or less in their account will not be paid out yet, but will also retain their claims. 

Depositors will be contacted via email or telephone from Monday next week to explain what they should do. 

"We recognise the anxiety, stress and financial burden placed on depositors given that they have not been able access their bank accounts during curatorship, and are delighted that the SARB has agreed to make such payments which will go a long way to provide some relief to eligible depositors," he said. 

He reminded customers with credit facilities from the bank that they are legally obliged to continue to pay their monthly instalments.

Du Plessis added he was still assessing HOB's financial and operational future, and that an "ultimate resolution" for the bank was still under consideration.

Earlier in the week, the Reserve Bank had said that "in-depth investigations and analysis undertaken by the curator" by Du Plessis had concluded that HOB’s financial position was "significantly worse than initially anticipated". 

Habib Overseas Bank is unrelated to Habib Bank AG Zurich, which also operates in South Africa.