AYO takes on Access Bank over accounts
JUDGMENT has been reserved in the case where Jse-listed
AYO Technology Solutions had approached the Western Cape High Court on an urgent basis seeking an immediate restoration or re-opening of its bank accounts with Access Bank.
As well as restoration of its accounts AYO is also seeking an order prohibiting Access Bank from deactivating or closing the accounts.
AYO also wanted the bank to be prevented from limiting the manner in which AYO operates the bank accounts. This would ensure that AYO was allowed to operate the bank accounts in the same manner as it did prior to the termination and closure of the affected accounts.
AYO’S lawyer, Tanya Golding, told Judge Nobahle Mangcu-lockwood the company first contacted Access Bank on April 20, 2021.
Eventually, after several communications, Access Bank’s then chief executive, Bennie van Rooy, informed AYO in June 2021 that the bank did not have the “necessary risk appetite” to take the company on as a client.
On March 18, 2022, Sekunjalo Group of Companies (Sekunjalo) executive chairman Dr Iqbal Survé approached the bank’s new chief executive, Sugendhree Reddy, seeking a meeting. Reddy responded on March 24 and said Access Bank was a respondent in the Competition Tribunal matter involving Sekunjalo and nine of the country’s biggest banks.
Reddy said once litigation in the matter had been concluded it would be more appropriate to resume correspondence on the issue.
It emerged in AYO’S arguments in court that Access Bank had relied on the Mpati Report to justify its conduct.
The Mpati report has since been taken on review after Sekunjalo and related entities approached the Western Cape High Court.
The court heard that in April
2022 AYO was approached by a Mr Dowlath who offered to assist it to approach Access Bank as an intermediary. The application forms made it clear that it was AYO applying for the account.
On May 10 the bank opened a current account for AYO and the company transferred multiple sums into that account on four occasions. The banking agreement was subject to Access Bank’s standard terms and conditions.
Without any warning, on May
31, Access Bank closed the accounts and said it was terminating its agreement with AYO. The letter from the bank repeated an earlier statement that it wished to wait for the outcome of the Competition Tribunal proceedings.
Golding argued that the closing of the accounts would do irreparable damage to AYO. “It’s not an exaggeration to say AYO is hanging on for life.”
She said AYO was a Jse-listed company with institutional shareholders including the Public Investment Corporation which invested government employee pension funds.
The issues in dispute in the case included whether the Western Cape High Court had the jurisdiction to hear the matter and whether it was urgent. For their part, Access Bank wanted the court to strike the matter from the roll with costs, claiming it was not urgent.
The bank’s lawyer, advocate Adrian Botha SC, also argued that the bank’s relationship with a customer is not governed by administrative law, but private law of contract.