Public lender Bank of Baroda has decided to shut down its operations in South Africa. This update comes months after the fine of R 11 million was imposed on the bank by South African Reserve Bank for lapses in the compliance.
The bank has already notified the South African Reserve Bank regarding its exit.
“The Registrar, which is part of the South African Reserve Bank (SARB), is in discussions with the Bank of Baroda to ensure its orderly withdrawal from South Africa so that no depositor is disadvantaged,” said a statement issued by South African Reserve Bank.
This exist is also linked to bank’s funding to Gupta family of Indian origin who reportedly took undue advantage of their connection with South Africa’s president Jacob Zuma.
According to South African authorities, a large sum of money had been transferred to Zuma family and the matter is now under investigation.
The bank issued a clarification last week, stating that, “The Reserve Bank of South Africa is investigating the allegations against Bank of Baroda and the bank is actively cooperating and supporting these investigations.”
In June last year, the banking regulator from South Africa began investing in the financial transaction of Gupta family and its connection with all the banks. As a reaction to this, Standard Bank, Nedbank, First National Bank and Barclays Africa Group discontinued banking its funding to the family but Bank of Baroda allegedly continued with its banking relations with the family.