MBABANE -The SCBS Shareholders and Investors have insisted that they are pushing for a Judicial Management of the Society than liquidation.
This is contained in the replying affidavit submitted in court by the Intervening Parties -The Shareholders and Investors.
The Financial Services Regulatory Authority (FSRA) is the Applicant in the matter while the Status Capital Building Society,Mbongiseni Nkambule,Nhlangano Town Council and the Shareholders and Investors are respondents (Intervening Parties).
The Shareholders and Investors are represented by Mtshali Ngcamphalala Attorneys.
Magagula and Hlophe Attorneys represent the FSRA.
Judicial management is a corporate rescue mechanism where a court appoints an independent manager to take over the management of a financially distressed company. It aims to restructure debts, rehabilitate the business, and avoid liquidation, offering a better recovery for creditors compared to immediate winding up
According to the court papers submitted by the Intervening Parties,there were a number of factors that must be considered before a Building Society is liquidated.
“These factors must also take into account the objectives of the Act.The objectives of the Act are fostering,through the regulation and prudential supervision of financial services providers,the stability of the Swaziland financial system,the safety and soundness of financial services providers and protection of shareholders.”
Additionally,the shareholders further argued that the FSRA was required to demonstrate that the winding up of the Status Capital Building Society would be an achievement of the said objectives.
The shareholders also insisted that the FSRA had failed to demonstrate that the liquidation was in line with the Building Society’s Act through the fact that the investors were all in full agreement that the Society should not be liquidated but rather be placed under Judicial Management.
“The purpose of the Act is to serve public interest and as such alternative remedies must also take a central place in the enquiry.Consequently,the Judicial Management course must be considered.”
The Intervening parties further challenged the court to appreciate the fact that the FSRA had failed to set out the number of Shareholders and Investors who were in support of the application for liquidation.
Even then,it was further submitted that whatever percentage they were,they did not represent the majority of the shareholders as a large number was clear on the course to be taken as an alternative to the liquidation.
On another note,the Intervening Parties also explained the issues surrounding
the license against liquidation.
“Regarding the License,I state that the only time that a financial service provider can be liquidated is when its license has been revoked.The expiration of a license is not sufficient ground for liquidation because it can be renewed.”
According the the Shareholders and Investors,the SCBS license was not renewed for obvious reasons.
“The compliance office had been taken over by the curators,one of which was from the FSRA’s Executive Committee.I am confident that it can be renewed if the SCBS is afforded the opportunity to remove the occasion that led to the FSRA’s consideration of the liquidation.It would have been a different situation if the licence was revoked.The judicial management will afford the Status Capital Building Society the opportunity to conduct its business accordingly.”
Significantly,the defence further argued that the curatorship cannot be equated to judicial management as these are totally different processes meant to achieve different objectives.
“The SCBS will present the personnel it believes is fit and proper for the Judicial Management to the FSRA and the latter can conduct a Fit and Proper enquiry on the said personnel.”
Last but not least,the defence highlighted that the former Curator Bmal stated succinctly clear that the SCBS should not pursue the liquidation option since the entity can be revived.
“What compounds the situation is the fact that the FSRA only introduces the report of the week ending August 22,2025 in its reply and as such the Shareholders and Investors cannot extensively deal with.Even if the report were to be considered,the curator does not recommend liquidation.He only gives the opinion that the mismanagement has made it extremely difficult to uplift the entity to an operational form.This opinion was based on the fact that the SCBS was under curatorship.”
Initially,the High Court of Eswatini placed Status Capital Building Society (SCBS) under provisional liquidation, effective December 24, 2025, following an application by the Financial Services Regulatory Authority (FSRA).
Tygerberg Trustees (Pty) Ltd was appointed as the Provisional Liquidator of SCBS.
Tygerberg Trustees (Pty) Ltd is a South African fiduciary services firm based at Tyger Waterfront, Bellville, specializing in liquidations, business rescue, deceased estates, and trust services.
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