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Godongwana announces R10bn guarantee for the Land Bank

Published

The guarantee, announced in the 2026 medium-term budget policy statement, will help the Land Bank raise funding and meet debt obligations due in early 2028. The statement also flagged fiscal risks from state-owned entities, including Denel and SAA.

Finance Minister Enoch Godongwana tabled the statement in a joint sitting of parliament on Wednesday. The statement says investor confidence in the Land Bank remains weak. It says the bank has limited access to funding, which constrains its core agricultural lending. The Land Bank's outstanding debt fell from R40bn in March 2020 to R6.9bn in March 2026.

The statement says Denel's main fiscal risk is whether it can stabilise operations and generate enough cash without more state support. Government gave Denel guarantees of R660m and $14m for secured contracts. It also says Transnet remains a material medium-term fiscal exposure because of its weak financial position. Eskom's fiscal risk has eased.

SAA received a R1bn government guarantee in August 2026 for working capital. It also has R223m in guarantees linked to unflown-ticket liabilities and letters of credit. The government guarantee portfolio stood at R982.4bn in March 2026 and R960.6bn in June 2026. The statement also set aside R2.2bn for the Ithala Development Finance Corporation.

Key facts

Who
Enoch Godongwana (Finance minister); Jabu Mphambo (Acting CEO of the Land Bank); Land and Agricultural Development Bank of South Africa (State-owned bank (Land Bank) receiving the guarantee); Denel (State-owned defence company with liquidity constraints)
What
The MTBPS, tabled in a joint sitting of parliament, announced a R10bn government guarantee for the Land and Agricultural Development Bank of South Africa and flagged fiscal risks from state-owned entities including Denel and SAA.
When
21 October 2026
Where
South Africa, Cape Town
Status
Reported

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