Any business of the African Bank Limited (ABL) was conducted recklessly or negligently or with the intent to defraud depositors or other creditors of the bank, the South African Reserve Bank (SARB) said on Thursday.
The business of the bank involved questionable management practices or material non-disclosure, the SARB said in a report on the findings into misconduct of the ABL.
The report found that the ABL's business was conducted negligently by not making prudent, appropriate provisions from time to time, not properly managing reasonably foreseeable risks such as a poor economy, competition and labour unrest, and by aggressively growing the book.
Furthermore, it was found that the board members were negligent in allowing themselves to be dominated by Leon Kirkinis, CEO of the bank.
The ABL, South Africa's largest provider of loans, collapsed in 2014 because its loans were not backed by assets.
The bank, rescued by the South African government, reopened in April this year.
The bank suffered a loss of at least 5.8 billion rand (about 386 million U.S. dollars) in the 2013 financial year.
By 2013, it had a book of some 60 billion rand (about four billion dollars), three million customers and about 5,700 employees.