Cape Town - The integration of the failed UniFer into Absa Bank was largely complete and a new division had been formed out of the old microloans business, which had made a small profit in the year to March 2003, the bank said at the weekend.
Absa was caught in the eye of the banking crisis last year when its microloan subsidiary UniFer collapsed.
Subsequent investigations into the collapse of UniFer revealed untenable conflicts of interest among management; unsustainable growth in the volume of loans; unauthorised granting of loans; executives receiving inappropriate payments from brokers; and a breakdown in critical controls through the unauthorised provision of override codes for credit control systems.
Since then Absa has tightened its control over UniFer, buying out minorities, delisting it and forming a new specialist division called UB Microloans. Unibank's banking licence was cancelled from March 31 this year.
All the investigations into UniFer, including the forensic probe, board investigations into the conduct of Absa officials and the investigation required under section 7 of the Reserve Bank Act, have been concluded.
Bert Griesel, chief executive of UniFer, said a "substantial legal exercise" was under way, involving defending what was perceived to be unjust claims, recovering money owed to Unibank and laying criminal charges. But these matters were sub judice, he said.
A number of people had been dismissed on the investigations.
As at the end of March the gross microlending advances stood at R3.6 billion, with a provision of R2.1 billion. None of the provisions had been reversed in the past year. The gross microlending book had run down significantly over the past year - it stood at R4.8 billion when UniFer collapsed.