African Bank has walked away from one of its boldest growth bets, abandoning a R5.7 billion deal to buy Eskom's staff home-loan portfolio after deciding the transaction had become more trouble than it was worth. The agreements lapsed when key conditions were not met by the end of March, and the lender has now confirmed it will not revive them.
Why the deal lapsed
The transaction was first announced in December 2024 under then-chief executive Kennedy Bungane, who pitched it as a way to rapidly scale African Bank's home-loan book. It formed part of Eskom's broader push to shed non-core assets, with the power utility under pressure to exit its employee home-loan business as a condition of the government's debt-relief package.
But the conditions precedent attached to the deal were never fulfilled by the extended deadline of 31 March 2026, and the agreements simply expired. Bungane resigned abruptly in March amid weak results and a regulatory reporting stumble, leaving the bank to reassess its priorities under new leadership.
Consolidation over ambition
Interim chief executive Zweli Manyathi has made clear the bank would rather tidy its own house than chase scale. The Eskom deal, he told Business Day, would have created "a major distraction" at a time when African Bank is trimming what it does and consolidating what it already has.
The caution is understandable. African Bank swung from a R262 million profit in its 2025 financial year to a R624 million loss in the first half of 2026 — a sharp reversal for a lender that had hoped to strengthen its balance sheet ahead of a long-mooted listing on the JSE. The home-loan acquisition had been central to that ambition, and walking away marks a quieter, more defensive chapter.
For Eskom, the collapse means finding another buyer for a portfolio it is still obliged to offload. For African Bank, the message is that stability now matters more than expansion — at least until the books look healthier.
