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South Africa Won't Bail Out Councils Hit by VBS Bank Collapse

  • What municipalities did, was ‘unacceptable,’ Mkhize says
  • Culture of non-payment weighs on councils’ finances: minister
Johannesburg 

Johannesburg 

Photographer: Dean Hutton/Bloomberg

South Africa’s government won’t bail out 13 municipalities that lost about 1.65 billion rand ($119 million) they invested in VBS Mutual Bank before it collapsed in March, according to Cooperative Governance and Traditional Affairs Minister Zweli Mkhize.

“All these monies were wiped out,” Mkhize said in an interview at Bloomberg’s Johannesburg offices on Friday. “What they have done is unacceptable and if that money is lost, it is actually lost to the fiscus and the communities that it was supposed to service.”