High Court to rule on SME Bank liquidation
Judge Hannelie Prinsloo will deliver her ruling on the urgency of the Bank of Namibia's application for the liquidation of the SME Bank this afternoon.
An attempt to slow down the planned liquidation of the SME Bank by minority shareholders Metropolitan Bank of Zimbabwe and World Eagle Properties was rejected by Judge Hannelie Prinsloo on Friday.
Metbank and World Eagle Properties lodged an application to prevent the provisional liquidation of the SME Bank by the Bank of Namibia.
The central bank, which took control of the SME Bank at the beginning of March, brought an urgent application for the provisional liquidation of the SME Bank in the High Court after it had discovered that dubious investments of between N$181 million and N$196 million had been made in questionable financial instruments in South Africa. Appearing on behalf of the Met Bank and World Eagle Properties, lawyer Sisa Namandje argued that the matter was not urgent and that the Companies Act was opposed to liquidation. He argued that if other remedies were available, such options should be exercised rather than liquidation. He also argued that his clients' rights were violated because they were not given a reasonable opportunity to respond to the application.
Senior counsel Andrew Corbett, on behalf of the central bank, told the court on Friday that the central bank would only ask for a provisional liquidation order and not an order for the final liquidation of the SME Bank.
He further argued that the central bank only tried to protect the assets and interests of the SME Bank's creditors. He added that efforts should be made to recycle investments outside the borders. Corbett said the matter was inherently urgent and could not wait to be heard in 2018 because there would be damage if the SME Bank was not liquidated. According to him, a preliminary liquidation would prevent loss of the bank's assets and also prevent a large-scale withdrawal of funds. He further argued that there would be no sense in hearing the application next year.
He also said that the BoN had a duty to regulate the SME Bank's liability and operations and that it would evade its responsibilities if it allowed SME Bank operations to continue.
Judge Prinsloo will deliver her ruling on the issue of urgency this afternoon at 14:15.
JACQUELINE LOUW
Metbank and World Eagle Properties lodged an application to prevent the provisional liquidation of the SME Bank by the Bank of Namibia.
The central bank, which took control of the SME Bank at the beginning of March, brought an urgent application for the provisional liquidation of the SME Bank in the High Court after it had discovered that dubious investments of between N$181 million and N$196 million had been made in questionable financial instruments in South Africa. Appearing on behalf of the Met Bank and World Eagle Properties, lawyer Sisa Namandje argued that the matter was not urgent and that the Companies Act was opposed to liquidation. He argued that if other remedies were available, such options should be exercised rather than liquidation. He also argued that his clients' rights were violated because they were not given a reasonable opportunity to respond to the application.
Senior counsel Andrew Corbett, on behalf of the central bank, told the court on Friday that the central bank would only ask for a provisional liquidation order and not an order for the final liquidation of the SME Bank.
He further argued that the central bank only tried to protect the assets and interests of the SME Bank's creditors. He added that efforts should be made to recycle investments outside the borders. Corbett said the matter was inherently urgent and could not wait to be heard in 2018 because there would be damage if the SME Bank was not liquidated. According to him, a preliminary liquidation would prevent loss of the bank's assets and also prevent a large-scale withdrawal of funds. He further argued that there would be no sense in hearing the application next year.
He also said that the BoN had a duty to regulate the SME Bank's liability and operations and that it would evade its responsibilities if it allowed SME Bank operations to continue.
Judge Prinsloo will deliver her ruling on the issue of urgency this afternoon at 14:15.
JACQUELINE LOUW
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