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South African banks consider fund to help increase black farm ownership

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South African banks consider fund to help increase black farm ownership

Banks in South Africa are in discussions to launch a joint special fund that may be used to transfer more land to black people while not undermining financial stability, Bloomberg News reported.

"We're absolutely convinced as an industry that for the long-term sustainability of economic and social well-being in this country, we do need to address the serious problems and inequities we have," Banking Association of South Africa Managing Director Cas Coovadia told the newswire.

One way to help achieve that could be a joint fund, he said.

White farmers own nearly 75% of South Africa's agricultural land, according to figures from lobby group Agri SA. Banks have 148 billion rand outstanding in loans for agricultural land, according to the Banking Association of South Africa's figures. This compares to 1.07 trillion rand for residential mortgages.

As of Aug. 31, US$1 was equivalent to 14.68 South African rand.