A R600m Handshake: Nedbank and Transnet Settle Contentious Swap Dispute

In a move that underscores the long and costly shadow of the state capture era, Nedbank has agreed to pay state-owned logistics giant Transnet R600 million to settle a bitter legal dispute. The agreement, announced in a joint statement, brings an end to a year-long court battle over controversial interest-rate swap deals struck nearly a decade ago.

The settlement arrives without any admission of liability from Nedbank. Both parties framed the resolution as a pragmatic step to avoid a protracted and expensive legal war, preserving a business relationship they deem important for the country’s infrastructure and economic growth.

The Heart of the Dispute

The case, initially brought by Transnet and the Special Investigating Unit (SIU), revolved around swap transactions entered into in 2015 and 2016. The SIU had alleged that Nedbank made an outsized profit of more than R2.7 billion from these deals.

The transactions were deeply tainted by their association with Regiments Capital, a financial advisory firm entangled with the controversial Gupta family. A judicial commission of inquiry into state capture found that the Guptas leveraged their relationship with former President Jacob Zuma to influence and corrupt state procurement processes, and the Transnet swaps were flagged as potentially corrupt.

Nedbank, for its part, has maintained it was an unaware third party, stating it had no knowledge of any alleged collusion between Regiments Capital and corrupt Transnet officials.

A National Interest Resolution

By choosing a confidential settlement over a courtroom verdict, both entities have opted for closure. The joint statement explicitly described the resolution as being “in the national interest,” allowing them to move forward and continue collaborating on critical infrastructure projects.

For Transnet, which is struggling to recover from years of corruption and operational decay, the R600 million payment represents a tangible recovery of funds. For Nedbank, while a significant sum, it draws a line under a damaging chapter and the legal uncertainty that came with it.

The settlement is a stark reminder of the complex web of deals orchestrated during the state capture years and the long, complicated process of untangling them. It shows that even for major banks, the fallout from that period is not yet fully in the past, but can be settled with a multi-million rand handshake.