VBS Mutual Bank Annual Report

VBS Mutual Bank Annual Report

VBS Mutual Bank Annual Report, The curator of embattled VBS Mutual Bank has withdrawn the audited annual financial statements of the bank for the year ended 31 March 2017, as they contain material misstatements and are no longer considered reliable

VBS, the bank that loaned former President Jacob Zuma R7,8 million to repay the costs of non-security upgrades at his Nkandla home, was placed under curatorship last month by the South African Reserve Bank after experiencing increasing liquidity challenges over the past 18 months.

VBS’s external auditors, KPMG South Africa, on Sunday admitted that senior partners Sipho Malaba and Dumi Tshuma had misled the firm about their relationship with the bank and did not disclose loans they took from VBS.

Malaba, the engagement partner of KPMG with VBS, gave the bank an unqualified opinion when he signed off the annual financial statements to end March 2017.

KPMG said it would be reviewing work done by all its audit partners in the past 18 months, and is conducting background checks of its audit partners and their spouses.

Early indications as uncovered by the curator have found that deposits worth R900 million reportedly went missing while audit form PwC was the company’s internal auditor. As a result, the curator has also asked PwC to stop its work as internal auditor at VBS.

Curator Anoosh Rooplal of SizweNtsalubaGobodo said in a statement that users of these financial statements, which have been removed from the bank’s website, were requested to not place reliance on them.

Rooplal said that the amended or restated financial statements will be reissued in due course, adding that the bank’s external auditor, KPMG, has been duly informed.

“The decision to withdraw the 2017 audited financial statements will not change our focus as curator,” Rooplal said.

“We are still of the view that the curatorship role provides the best mechanism to rehabilitate the bank if possible and my primary role of stabilising the bank and protecting the interests of depositors remains firm.”