In a quiet but significant turning point in South Africa’s long state-capture clean-up, Nedbank will pay Transnet R600m to settle litigation over the controversial interest-rate swaps that have persisted over both institutions for almost a decade.
Announced on November 25, 2025, the confidential deal, with no admission of liability, halts a bruising legal war that risked dragging into 2027, burning tens of millions in fees and pulling both sides back into a political firestorm they’re desperate to move past.
For Nedbank, agreeing that Nedbank will pay Transnet R600 million in a settlement is less concession than calculation: avoid years of discovery, protect a R10-billion-plus commercial relationship, and step out of reputational quicksand just as South Africa claws its way through a promising 1.1% GDP recovery.
For Transnet, drowning in debt and crumbling infrastructure, the payment is a timely cash infusion and a symbolic victory in its campaign to claw back funds lost to state capture.
The Heavyweights
Nedbank, which is South Africa’s fourth-largest bank with R1.6 trillion in assets, has been a core financier of Transnet’s port, freight and rail projects since the 1990s.
Under CEO Tom Singer, the bank is pushing double-digit ROE while managing the fallout from the Zondo Commission, which laid bare how Gupta-linked networks infiltrated SOEs and their advisors.
Transnet, the state logistics backbone responsible for 80% of the nation’s freight, is a shadow of its pre-2018 peak. A locomotive scandal pushed debt to R130 billion, rail obstacles restricted exports, and 2024 bailouts kept the utility afloat.
The Special Investigating Unit (SIU), Ramaphosa’s anti-graft bulldog, has been zeroing in on the swap deals for years, arguing they were engineered to siphon value to the Gupta network.
The Nedbank settlement follows a string of similar deals, including Regent Capital’s R200-million payout earlier in 2025, signalling a practical winding down of the state-capture litigation era.
The Swap Saga: A Decade of Accusations, Rebuttals and Escalation
The dispute dates back to 2015–2016, when Transnet entered a R12-billion loan hedged through interest-rate swaps designed on paper to protect the SOE from rising costs.
The advice came from Regiments Capital, later liquidated for corruption and implicated as a Gupta pipeline.
The SIU claimed the swaps embedded inflated mark-ups, alleging Nedbank pocketed as much as R2.7 billion in “undue profits.”
That money, investigators said, helped bankroll the Gupta empire. Nedbank denied this flatly, insisting the bank earned under R43 million, a standard market margin, and that Regiments, not Nedbank, advised Transnet.
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Litigation escalated in 2021. Failed mediations in 2024 hardened positions: Transnet demanded an admission of wrongdoing; Nedbank counter-sued and angled for a full airing of Transnet’s own governance failures.
By mid-2025, a painful discovery hung, threatening to unearth years of emails, committee minutes and Zondo-era testimony, an outcome neither side truly wanted.
| Issue | Transnet/SIU Claim | Nedbank Rebuttal | Settlement Outcome |
|---|---|---|---|
| Excess Profits | R2.7B+ siphoned via Regiments | < R43M earned legitimately | R600M payment without admission |
| Corruption | Collusion or enabling Gupta pipeline | No awareness or complicity | Settlement closes claims |
| Advisory Fault | Nedbank enabled risky swaps | Regiments advised; bank executed | Prior statements set aside |
A joint statement sealed the détente: the settlement “allows both parties to continue developing this important relationship in the national interest and for infrastructure investment and economic growth.”
Why Nedbank Paid: The R600M as Strategic Containment
The bank’s analysis was brutally simple. A trial threatened:
- Massive legal costs (north of R100 million).
- Reputational harm, with headlines dredging up Zondo testimony for months.
- SOE client fallout, jeopardising Transnet mandates worth R10B+ in financing, advisory and green-bond deals.
By contrast, a settlement even at R600 million is a controlled burn: a single financial hit, predictable, insurable, and unaccompanied by any stain of guilt. In its pre-close update, Nedbank stressed it “remains on track” for guidance once the one-off charge is absorbed.
Transnet, meanwhile, secures hard cash. With R70B+ in short-term obligations and declining freight volumes, the utility needs every rand to stabilise operations.
The settlement also helps reset its relationship with private lenders, who remain essential if South Africa is to repair rail corridors that could unlock 1% of GDP in export gains.
A Wider Reset
The deal unfolds against a broader turn of events. The SIU’s mandate was extended to 2025 to conclude remaining cases, but the political appetite is shifting from retribution to rebuilding.
Recoveries across SOEs now exceed R5 billion, and the private sector, cautious after the Zondo-era purge, is re-engaging cautiously.
For Nedbank, the settlement also aligns with its ESG-centric lending strategy, which earmarks billions for green infrastructure.
Transnet’s future rail and port modernisation programmes increasingly rely on such funding pools. Cooperation, not confrontation, is now mutually profitable.
Risks Avoided: The Litigation That Never Happened
Had the case gone nuclear, discovery could have exposed internal bank communications and sensitive client files, an operational and reputational minefield. Public hearings might have revived populist rhetoric around “bank complicity” and triggered new FSCA scrutiny.
For Transnet, counterclaims and forensic scrutiny could have fuelled further governance crises, shaking already fragile investor confidence and jeopardising sovereign support.
Confidentiality protects both sides. Closure keeps both institutions focused on forward-looking recovery rather than backward-looking recriminations.
The Verdict: R600M for a Clean Slate and a Clear Path Forward
Nedbank’s decision to settle is not capitulation; it is strategic de-risking. By transforming a R2.7-billion allegation into a R600-million controlled cost, the bank preserves a critical SOE partnership and sidesteps a legal quagmire that could have consumed years.
For Transnet, the money buys breathing room and a statement that accountability, even late, is possible.
Case closed. Tracks open. Now comes the real test: execution.
Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, climate change, and digital finance at Africa Digest News.
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