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Futuregrowth’s about turn – lifts funding suspension to Land Bank
by Tshepiso Mokhema
(Bloomberg) – Futuregrowth Asset Management, Africa’s biggest specialist fixed-income money manager, has lifted the suspension on borrowing money to South Africa’s agricultural lender, the Land and Agricultural Development Bank of South Africa said in a statement.
The about-turn follows “Futuregrowth’s extensive review of the governance and investor protection mechanisms of the institution during the last three weeks,” the Land Bank said in an e-mailed statement Monday. “As part of the engagement with Futuregrowth, some recommendations have been collectively put forward regarding enhanced transparency and public disclosures relating to governance structures.”
Futuregrowth Chief Investment Officer Andrew Canter didn’t immediately respond to a phone call, e-mail and text message seeking comment.
The Land Bank was one of six state-owned companies that Futuregrowth said last month it would stop funding due to concerns about how they are being run, government infighting and threats to the independence of the finance ministry. The asset manager said it would also stop lending to power utility Eskom Holdings SOC Ltd., rail and ports operator Transnet SOC Ltd., South African National Roads Agency SOC Ltd., the Industrial Development Corp. of South Africa and the Development Bank of Southern Africa. It said it would only resume offering loans and rolling over existing debt once it determined that proper oversight and governance at the companies have been restored.
The lender, which has a gross loan book of almost 40 billion rand ($2.9 billion), was one of five state-owned companies that Moody’s Investors Service put on review for a credit-rating downgrade earlier this month due to concerns about governance and the political environment.
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