The BRICS New Development Bank says it is open to funding South Africa’s state entities, after at least two privately-owned financial institutions publicly announced last week that they had stopped lending state owned enterprises.<\/p>\n
According to a report by the SABC, vice president of the bank, Lesley Maasdorp, said that South Africa’s state owned enterprises are free to approach the lender for assistance.<\/p>\n
Speaking to the SABC<\/a> on the sidelines of the G20 Summit in China, Maasdorp said the institution was set up to help member states, including their public enterprises.<\/p>\n The BRICS Development Bank is a multilateral development bank established by the BRICS states – Brazil, Russia, India, China and South Africa. The bank is headquartered in Shanghai, China, with a regional office in Johannesburg.<\/p>\n On Wednesday,\u00a0Futuregrowth Asset Management\u00a0\u2013\u00a0South Africa\u2019s largest private fixed-income money manager\u00a0\u2013 said it would stop lending money to six state companies (including Eskom) because of governance and transparency concerns.<\/p>\n \u201cWe\u2019ve observed recent reports that strongly hint of conflict between branches of South Africa\u2019s government, the possible machinations of patronage networks and a seeming challenge to the National Treasury\u2019s independence,\u201d the group told Bloomberg.<\/p>\n It was followed on Thursday, by Denmark\u2019s Jyske Bank, which told Bloomberg<\/a><\/strong> that it had also \u2018pulled the plug\u2019 on Eskom, citing concerns over governance.<\/p>\n \u201cWe pulled the plug on Eskom too yesterday,\u201d the group told Bloomberg.<\/p>\n \u201c(We) could easily see more lenders follow suit. We see issues on lending going forward and more governance issues.\u201d<\/p>\n Matshela Koko, Eskom\u2019s group executive for generation, told Business Report<\/a> that the company has approximately R300 billion of debt on its balance sheet, with Futuregrowth holding only R4 billion of Eskom bonds. “Put differently, the execution of our funding plan of R327\u00a0billiongoing forward does not rely on Futuregrowth\u2019s participation,” Koko said.<\/p>\n The ANC, meanwhile, described Futuregrowth’s actions as ‘unfortunate’.<\/p>\n \u201cThe ANC is concerned by the posture adopted by Futuregrowth. It is our hope that Futuregrowth will engage with the relevant ministries and parastatals to discuss the concerns they have; and together find a solution in the interest of the economy and country,\u201d party spokesperson Zizi Kodwa said last week.<\/p>\n Kodwa called on other investors to wait for the outcome of interventions by its Inter-Ministerial Committee before taking any \u201cpre-emptive stance\u201d against SOEs.<\/p>\n Second lender cuts funding to Eskom \u2013 others expected to follow: report<\/strong><\/a><\/p>\n Massive blow as major lender cuts funding to Eskom, Sanral and other SOEs: report<\/a><\/strong><\/p>\n 5 things the ANC wants you to know about Zuma, the Guptas and Gordhan<\/strong><\/a><\/p>\nMore on South Africa<\/h3>\n