The Land Bank is back on track and turning out a profit, but a legacy of past corruption is hampering progress at the entity, CEO Phakamani Hadebe said on Thursday.

Hadebe, who briefed Parliament on progress at the bank this week, said in an interview that many potential investors and clients still associated the bank with its past leadership.

"The turnaround strategy is bearing fruit," Hadebe said.

"The bank is changing. Investors are coming back. Clients are coming back. Qualified people are coming to work for us.

"But many people can't separate what is legacy or what is new. It comes out when investors are not sure whether to put money into the bank or not. "

From a human resources perspective, a large portion of time was being spent on forensic question and answer sessions.

"The day the authorities have these people behind bars, it will be a great day for the Land Bank. This is what people want to see."

The government has pumped more than R3.5-billion into the Land Bank in cash and guarantees to help it survive. The Treasury recently announced it would grant the Land Bank an additional R1-billion to help it keep it afloat.

Investigators are currently trying to trace the accounts used to strip the fund of money meant for emerging farmers.

Fraud in the bank's AgriBEE fund was first exposed by the bank's former chief financial officer, Xolile Ncame, who showed that more than R80-million had been disbursed in a few months on questionable projects, including a biofuels pilot plant in Mpumalanga, a feedlot and dairies.

Other irregular investments were made in golf and equestrian estates.

There was also alleged fraud in the emerging farmer empowerment scheme and IT irregularities.

Last year former president Thabo Mbeki moved oversight of the institution from Lulu Xingwana, then the agriculture minister, to then finance minister Trevor Manuel.

Hadebe, the head of Treasury's asset and liability management division , was seconded to take over as the bank's chief executive.

Hadebe said the bank was "in a mess" when he took over as CEO.

"There was no adherence to credit policies, corporate governance had been wiped out and there was a lack of adequate cash. Everything you can think of was non-functional."

Employees had put in a lot of work and the bank as a result had been able to turn in a profit of R166.6-million for the year, a sharp increase on the R17.5-million recorded in the previous year.

"Right now we have superb control systems. The cost of borrowing is increasing, investors are coming in and appropriate skills experience is coming in.

"We are still in the ward. But we are busy packing. We are ready to come out."

Willie Hofmeyr, the head of the National Prosecuting Authority's special investigations unit, told Parliament during the briefing that he attended with Hadebe, that money taken from the bank had been moved through a number of accounts and institutions.

He said the money had to be tracked manually using bank statements taken from long-term storage.

"As the investigation has unfolded, it has become clear that it has significantly wider ramifications than was originally thought, and that is what is really at the heart of what has made it difficult to conclude the investigation speedily," he said.

Hofmeyr said a number of the suspects included high-profile people whose names would be familiar.

Sapa

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