Land Bank says expropriation of land without compensation will have dire consequences for its sustainability. On Monday, the bank released its financial results for the year ending in March.
Its profit for the year increased 3.7% to R278 million. This amid contracting economic and credit rating reviews.
Land Bank’s loan book increased to R45 billion from R43 billion in 2019 and it dispensed loans of R1,5 billion to emerging farmers in the financial year ending 31 March.
However, it says many emerging farmers are battling to secure loans to buy farms. It is concerned about Government’s policy of expropriation of land without compensation.
“We, as the state institution, are funded by third party organisations. We raised money for the World Bank and local fund management industry. If a farmer was to be affected by expropriation, what happens to the loan that they owe to the landbank,” said CEO of Land Bank, Tshokolo Nchocho.
Finance Minister Nhlanhla Nene has called on the Land Bank to do an impact analysis on how the Agricultural sector will be affected by the expropriation of land without compensation.
“Among the things we discussed at the AGM, I requested the board of the Land Bank to conduct an impact analysis on the anticipated government shift of land expropriation without compensation,” said Finance Minister Nhlanhla Nene.
Land Bank’s non performing loans are currently at 6,7%, a drop from 7,1% in 2017. And the bank says it has been negatively affected by insurance claims due to hail and floods across the country.