Bonds

ANC infighting has hurt S.African state asset manager - former CEO

Credit: REUTERS/SIPHIWE SIBEKO

Turmoil in the ruling African National Congress has destabilised South Africa's state asset manager as rival factions jostle for influence over the multi-billion dollar fund, its former chief executive said on Wednesday.

President Ramaphosa appointed inquiry into asset manager

Followed allegations of misuse of funds

Politically connected people tried to tap into PIC - ex-CEO

Adds appointment of interim board

JOHANNESBURG, July 10 (Reuters) - Turmoil in the ruling African National Congress has destabilised South Africa's state asset manager as rival factions jostle for influence over the multi-billion dollar fund, its former chief executive said on Wednesday.

Dan Matjila, who resigned as CEO of the Public Investment Corporation (PIC) last year, told a judicial inquiry into alleged wrongdoing at the money manager that politically connected people had tried to tap into the more than 2 trillion rand ($141 billion) of funds that it oversees.

The ANC has seen bitter infighting in recent years, as factions loyal to President Cyril Ramaphosa and his scandal-plagued predecessor Jacob Zuma have battled for influence.

The PIC invests in the bonds and stocks of some of South Africa's largest companies on behalf of clients including a pension fund for public sector employees.

But its reputation has been tarnished by news reports and opposition politicians alleging that executives including Matjila misused funds and made careless investment decisions.

Matjila has denied those allegations, but Ramaphosa, who has staked his reputation on cracking down on corruption, set up the inquiry last year to investigate them.

Matjila said on Wednesday that whenever there was turmoil in the ANC "there was equal pressure or movement in the PIC". Matjila said he believed a "merry-go-round" of ministers and deputy ministers appointed to oversee the PIC in recent years wanted "to get control of the piggy bank of the PIC".

ANC spokesman Pule Mabe could not be immediately reached for comment.

Although the PIC is government-owned, the bulk of its investments are made on behalf of civil servants who contribute to the Government Employees Pension Fund.

Matjila, who said he wasn't aligned with any political party, alleged that the PIC had been subject to many forms of political pressure, including unsolicited requests for funding.

Deon Botha, the PIC's head of corporate affairs, said the asset manager did not comment on the inquiry but that it continued to make investments while the probe was ongoing.

Separately Finance Minister Tito Mboweni appointed an interim board of directors at the PIC following the previous board's resignation earlier this year, the ministry said in a statement.

The new board includes Maria Ramos, former chief executive of bank Absa ABGJ.J, and senior trade union figures Zola Saphetha and Ivan Fredericks.

Unions representing public sector workers have been pushing for greater influence in the affairs of the PIC.

($1 = 14.1732 rand)

(Reporting by Alexander Winning; editing by Emelia Sithole-Matarise and Jan Harvey)

((alexander.winning@tr.com; +27 11 595 2801))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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