Nedbank warns land expropriation could spark banking crisis

CAPE TOWN - Plans to change the Constitution to allow the expropriation of land without compensation could hit property prices and trigger a banking crisis, the chief executive of Nedbank told Parliament on Friday.

President Cyril Ramaphosa announced on 1 August that the ANC planned to change the Constitution to allow land to be expropriated without compensation.

READ: Banks caution against Constitutional amendment

Speaking to the Constitutional Review Committee -- which is investigating proposed changes to the constitution -- Mike Brown said there was no need to alter the law because the existing legislation already allowed the state to expropriate property for land reform purposes.

"As a commercial bank, we are a key role player in funding the economy and any material impact to property prices would adversely affect confidence in the banking system and could trigger a classic banking crisis with significant negative knock-on effects on the economy," Brown said.

Nedbank is the fourth largest bank in South Africa.