Director’s Cut: Kokkie Kooyman – SA banks, Gupta fallout, and the global Inflation shock

Top banking analyst Kokkie Kooyman lifts the lid on Nedbank’s R600m Gupta-linked settlement, FirstRand’s painful UK mistake, and why global banks are cutting jobs as AI takes over. Kooyman also explains how a 3% inflation target could turn the rand into a “hard currency” and why South African bank shares may be the market’s most overlooked opportunity..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..Watch here.Listen here.BizNews Reporter.South African banking analyst Kokkie Kooyman joined BizNews from a snowy Amsterdam, where he had just met executives from ING and ABN AMRO. He was struck by one thing that South Africans might find surprising. The Dutch economy is strong, growing fast, and running one of the healthiest fiscal balances in Europe. Dutch debt to GDP is 43 percent, loan growth is jumping, and the banks are aggressively cutting costs using digitalisation and artificial intelligence.In Europe, banks are shrinking their staff counts. ABN AMRO told Kooyman they plan to cut roughly five thousand jobs as mobile banking replaces expensive branches. Kooyman is very clear that South Africa will follow suit. If you work in a bank branch, he warns, you will need to ask yourself what new skills you are learning. AI and digital banking are not just coming, they are here.But this was only the warm up. Kooyman’s conversation with Alec Hogg centred on a very different story. The costly settlement between Nedbank and Transnet, tied to financing structures that were abused during the Gupta era. Nedbank and a consortium of banks helped finance locomotives for Transnet about a decade ago. At some point, the Gupta-linked firm Regiments Capital became involved, and interest swaps were moved from variable to fixed rates at a much higher cost. Transnet now argues that it paid an estimated three to four billion rand more than it should have.Kooyman is careful with his words. He does not believe Nedbank intentionally participated in corruption. He argues that large banks are simply too conservative to risk their brands on blatant kickbacks. But he is equally clear that banks were not inquisitive enough. They failed to interrogate the scale of the fees, the commissions involved, or the broader risks linked to state capture. In hindsight, the banks should have gone above Transnet and asked whether government was aware of what was happening.Nedbank has now paid a settlement of roughly six hundred million rand. The bank states it is not admitting guilt. According to Kooyman, this payment is most likely already provided for in previous results. Nedbank’s new CEO, Jason Quinn, appears to want the matter behind him. Kooyman says this is common in corporate life. New leadership arrives, sees legacy problems, and prefers to clear the deck and move forward.Kooyman points to a similar cleaning out at Nedbank’s African operations. Quinn has sold Nedbank’s stake in Ecobank at a loss because it was dragging performance. Better to take the pain and build the bank he wants to build. It is very likely that his approach to the Transnet settlement followed the same logic.The Guptas remain at large and have paid nothing for the damage caused to Transnet or to the reputation of Nedbank. For Kooyman, this remains one of the great injustices of state capture. Banks report suspicious activities to the Financial Intelligence Centre and can go no further. If the state fails to prosecute, corruption thrives and honest institutions pay the price.The conversation then shifted to FirstRand and its troubled UK business. Many South African financial institutions have tried to expand offshore. Kooyman reminds us that Nedbank, Old Mutual, and Sanlam all tried to escape the weak rand by buying assets abroad. FirstRand bought a UK vehicle leasing operation called MotoNovo, which later merged with Aldermore Bank to secure cheaper funding. The strategy was logical at the time. The problem came later.Regulators in Britain now believe that leasing companies managed to benefit from interest rate commissions that were not fully disclosed to customers. This was a widespread industry practice. The UK authorities are pushing to compensate clients and want the fines to go back as far as 2007. This reaches deep into the past and has hit FirstRand’s profit with several large provisions. Kooyman notes that the true cost is still unknown. This uncertainty has dragged FirstRand’s share price lower for years.Should FirstRand simply exit the UK now? Kooyman says it is complicated. Selling today would mean accepting a very low price. The cycle is against them. They may have to wait. Even so, the time is coming when FirstRand will need to decide whether it stays in the UK for the long haul or exits to focus on Africa, where returns on capital are rising.The most powerful part of the interview came at the end. Kooyman believes South Africa might be approaching a turning point. The new three percent inflation target could make the rand a stable currency and lower long term interest rates. Transnet’s performance is already improving, partly thanks to bank executives being seconded to help the state. Export volumes are rising. House prices are picking up. Corporate confidence is quietly returning.Kooyman thinks South African bank shares are far too cheap. He singles out Nedbank and Absa, each trading at around one times book value, offering dividends of six to seven percent. If the currency stabilises, inflation drops, and growth picks up, foreign investors will return. When they do, the first big winners, he says, will be the banks.For South Africa’s banks, the future now depends on whether the country finally does what the Dutch did many years ago. Invest in discipline, digitalisation, and clean governance. If that happens, the painful cleanup of the past may become the foundation of a far more valuable future.

Director’s Cut: Kokkie Kooyman – SA banks, Gupta fallout, and the global Inflation shock

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