South Africa’s Land Bank aims for debt solution by end-September

South Africa’s Land Bank is working on a new debt restructuring plan that it hopes will be finalised by the end of September, the National Treasury said on Wednesday.

The state-owned agricultural bank defaulted on its debt in April 2020 and missed a restructuring deadline in March 2021. It has so far failed to agree a “liability solution” to emerge from default.

“The last version of the liability solution was rejected by lenders. The board is currently developing a new liability solution which is planned to be concluded and implemented by 30 September 2022,” the Treasury said in a presentation to parliament.

It said the finance minister had appointed a new board of directors at the bank in December and that the process of recruiting a permanent chief executive was under way after the previous CEO left the company in April.

The R7 billion bailout allocated to the Land Bank in last year’s budget would not be transferred until the bank and its lenders agree on the debt restructuring plan, the Treasury said.