The life and times of Dr Sam Motsuenyane is the antithesis of Mikhail Yurevich Lermontov’s novel A Hero of Our Time, which is among the most celebrated Russian novels of the 19th century and one of the earliest examples of a “superfluous man” novel, one with an especially talented Byronic hero who does not fit in with the norms of society.

The Byronic hero is often unmindful, indifferent or unempathetic with society’s issues and can carelessly distress others with his inactions, despite his position of power.

He is prone to verbalising outlandish claims, brave rhetoric and poor calculus. He acts small, but celebrates big, and often uses his power for his own comfort and security. 

He will have very little interest in being charitable or using power for the greater good, epitomising the idleness, inertia and indecision of the feudal nobility that commands the resources but does little to cultivate them.

He can think but cannot act, for he sees meaninglessness in activity, contributing nothing to his development or that of society – a custom destined to dissolve in the acid of time.

A life of action

Dr Sam Motsuenyane was the absolute opposite, having unflinchingly dedicated his entire life towards undoing the apartheid legacy, working towards eradicating geographical, racial and gender discrimination.

He dedicated his life to helping others and was always determined to preserve the good name of black business, its independence and culture – always acting in our shared history and pride, expanded the virtues of labour, people and their right to live as an honourable constituency and vying for parity among others. 

He saw big business as a fundamental basis for granting full participation in our society. It transcends far beyond the dominant culture, intentions, language, rules, dynamics, epicentre, money and power. 

Indeed, everything about business must be changing to grow the economy by creating more opportunities for more people to participate in decision-making and decision outcomes.

He democratised business in thousands of neighbourhoods and urged action, not caution. 

Motsuenyane, the antithesis of the superfluous man, knew it is better to err on the side of action and take risks rather than play it safe – that in life, it is more useful to be decisive than to be correct.

The father of black business

Tim Modise and I went three times to his home in Winterveld to visit the 97-year-old Dr Sam Motsuenyane. Among many things discussed and planned, we wanted to ensure wide and deep distribution of his books, A Testament of Hope: The Autobiography of Dr Sam Motsuenyane and Tlhago Ya Bakwena-ba-Mmatau Le Kutu Ya Se-Motsuenyane, a book breaking down the family tree rooted in farming the land.

When I was the president of the Black Management Forum, we laid a foundation that culminated in him being honoured with a Lifetime Achievement Award.

Dr Motsuenyane, widely regarded as the father of black business, served as a member of Parliament and was the first South African ambassador to the Kingdom of Saudi Arabia. He served as leader of the House in the Senate (now known as the National Council of Provinces) and led the Motsuenyane Commission of Inquiry into human rights abuses. 

He was a recipient of the National Order of the Baobab (Gold) in recognition of his role in fostering the development of black-owned businesses and economic liberation.

He founded the Dr Sam Motsuenyane Rural Development Foundation – created and designed to address the needs and challenges which currently impede the development of township and rural communities in South Africa, more especially in the agricultural sector. 

The foundation’s roots are anchored in townships and rural areas where some of its flagship agricultural projects in grain, vegetables and citrus production are located, spanning Gauteng, North West and Mpumalanga.

He was honoured with a Lifetime Achievement Award at the Township Entrepreneurship Awards in 2017 for his pioneering work in promoting entrepreneurship and black business in the townships during the dark days of apartheid.

It was Dr Reuel Khoza, who, on the occasion of Dr Motsuenyane’s birthday, opined, “We can say, without any fear of contradiction, that Sam Motsuenyane’s leadership life defined an era in South African economic history. Practical manifestations of that epoch include such valiant efforts as Black Chain, African Bank and later Thebe, Nail, Rail, Saflige, Capital Alliance and WIP. Valuable lessons were learnt from these initiatives by those who care to observe and learn.”

Founding of African Bank

He nostalgically told us how, on the first day of the first National African Federated Chamber of Commerce and Industry (Nafcoc) conference in May 1964, about R70 was put on the table by organised black business to advance the development of the “people’s bank”, pretty much like “Volkskas”. (Nafcoc is the country’s oldest black business association.)

The target was R1-million, which was the minimum equity required then to establish a bank. Dr Motsuenyane, who later became the founding chairman of African Bank, was the inaugural president of Nafcoc, and together with his colleagues traversed the country to secure a broad-based buy-in that came via participants paying R100.

This momentum was boosted by some “homeland” leaders. KwaZulu, under the leadership of Chief Mangosuthu Buthelezi, put up R25,000. The R1-million target was hit and African Bank launched its first branch, 11 years later, in 1975, in Ga-Rankuwa. A total of R10-million was ultimately raised.

The truly amazing and beautiful story of resilience ended with the meltdown of African Bank, with billions of rands of value destroyed and then CEO Leon Kirkinis leaving. African Bank was placed under curatorship in 2014, collapsed by years of reckless lending and a spiral in bad debt.

Separated into a “good” and “bad” bank, it was recapitalised with R10-billion from South African commercial banks, the Government Employees’ Pension Fund (GEPF) as well as the South African Reserve Bank (Sarb), which in February this year announced that it was time to exit, as per the original plan.

Some of the reasons for the collapse of African Bank was that it had a single source of income and unsecured loans, and the fact that it acquired Ellerines in 2007. Commissioner Advocate John Myburgh had also blamed poor fiduciary oversight by the Board of African Bank Investments Ltd. The  African Bank failed, among others reasons, primarily because it drifted from its original intent “as a savings and loan institution”.

There are several causes of bank failures, including credit risk, market risk, liquidity risk, capital requirements, bank regulation, inefficient management and external economic factors. Some of the banks to fail since 1994 include Prima Bank, Sechold Bank, Community Bank, Islamic Bank, FBC Fidelity Bank, New Republic Bank, Regal Treasury and Saambou.

VBS Mutual Bank, which was also put under curatorship, marked the 13th bank in almost 30 years to go through the process in South Africa – and the first since African Bank’s collapse.

New opportunity

In 2014, during the failure of African Bank, Sarb’s commitment to protecting the integrity of the system saw it take the extraordinary step of participating in the rescue process as both a regulator and a shareholder.

The structure adopted at that time was aimed at illustrating the sense of trust that exists within the system.

Now, as Sarb ponders the well-anticipated disposal of its equity, an opportunity exists to sell back the African Bank to its original black founders – to focus on its mandate derived in the Constitution, to “protect the value of the currency in the interest of balanced and sustainable economic growth”.

The exit process provides a unique opportunity to revisit a long-standing question of transformation in financial services in general and the banking sector in particular. It also provides opportunities for bringing the often-neglected groups such as stokvels, burial societies, rural and community-based investment associations into the mainstream economy – the target market of the bank.

The curatorship conducted by Sarb in 2014-2016 was unique. This was because the bailing out of the bank galvanised not only Sarb and GEPF resources, but also private sector resources. 

The five major banks contributed by buying 25% of African Bank, investing about R2.5-billion and putting in a credit line of R8-billion.

This marked the first bank rescue undertaken using private sector capital with guidance from the Financial Sector Conduct Authority using the “Twin Peaks” model. 

Sarb has announced a public process for the disposal of its equity in African Bank, inviting private companies to open a free and fair bidding process. Rather than pursuing the “State Bank Project” in these unusually perilous times, which might cost the fiscus a minimum of R10-billion, here is another golden opportunity that must not be missed.

This amount would just be the acquisition cost and does not not include what is likely to be an even more sizeable amount to recapitalise the few banks that might be required, as part of the “State Bank Project”.

It is self-evident that the fiscus is too constrained to afford such an unnecessary expenditure amid ongoing State Capture and anaemic economic growth, and in the wake of the Covid pandemic and the rampant looting in July 2021.

Condolences

Our heartfelt and sincere sympathies and condolences to ’Me Jocelyn, Dr Sam Motsuenyane’s remaining children, grandchildren, great-grandchildren and business associates, as well as members of his clan, especially having just been struck by the double tragedy of the recent passing away of their eldest son, Phukwi Palmer Motsuenyane, and daughter-in-law, Pinkie Mosima Motsuenyane.

Robala ka kagiso Mokwena wa MmaTau! DM