Customize Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorized as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customized advertisements based on the pages you visited previously and to analyze the effectiveness of the ad campaigns.

No cookies to display.

Banner Left
Banner Right

Namfisa to focus on risky business

Namfisa to focus on risky business

THE Namibia Financial Institutions Supervisory Authority (Namfisa) decided last March already that it needed to sharpen its risk-based supervision, nearly eight months before Prowealth Asset Managers Chief Executive Officer (CEO) Riaan Potgieter committed suicide after allegedly stealing about N$49 million from investors.

‘In future, the Authority will rely less on compliance-based supervision and more on the prudential supervision of financial institutions,’ Namfisa Chairman Rick Kukuri said in his review in the watchdog’s annual report for the year ended March 31 2008, tabled in the Parliament this week.’Fostering a sound and solvent non-bank financial sector is at the heart of good regulation,’ Rainer Ritter, then the CEO of Namfisa, said in his review on the next page.Namfisa will shift towards ‘risk-based supervision which will improve the ability to identify emerging risks and quickly implementing corrective action’, Ritter said.’A risk-based supervisory approach will involve an increased level of supervision and regulatory scrutiny of those institutions that pose a higher risk, leading to an increased incentive for institutions to act with integrity and employ good business practice,’ he said.Namfisa has been at the heart of the Prowealth controversy. Observers like DTA Member of Parliament Johan De Waal have criticised the authority for not properly supervising the company.An auditing report of Grand Namibia filed with the High Court recently, stated that Prowealth Asset Managers ‘has not fulfilled any of the duties imposed on it with regard to the maintenance of proper accounting records’. The report furthermore said that the company didn’t lodge audited financial statements for its 2006, 2007 and 2008 financial years with Namfisa.Yet Namfisa Acting CEO Lily Brandt stated in court documents: ‘Namfisa had no reason to suspect any irregularities in the business of the company.’According to Namfisa’s latest annual report, the authority, pursuing its slogan of ‘safeguarding the nation’s wealth’, spent 133 per cent more on internal and external audit services last year, running up a bill of more than N$966 700 for auditors’ fees.Salaries and bonuses of N$11,2 million were paid during the period, 20 per cent more than in 2007. Compensation for ‘key management’ amount to N$3,4 million – more than a quarter of Namfisa’s total salary bill for 2008.Operational expenses increased by nearly 50 per cent to N$41,3 million, leaving Namfisa with a surplus of N$13,7 million at financial year-end – about 40 per cent less than the previous year.The Namfisa report was released as Brandt announced that the country’s entire investment management sector would be subjected to audit.’The aim of this audit is to, based on the lessons learnt from the Prowealth matter, obtain an accurate picture of the soundness of this critically important sector of our economy,’ Brandt said in an advertisement on Monday, adding that the audit will start ‘within the next two weeks’.Pending the outcome of the audit, Namfisa will take corrective measures ‘to restore and maintain required levels of confidence in the investment management sector’, she said.In the advertisement, Brandt admitted that there are ‘weaknesses in the current legislative framework’. Namfisa has been working on a revised framework in the form of the Financial Institutions and Markets Bill, which will ‘be enhanced by prudential standards’ and which will address the weaknesses in the current laws, she said.’Through these prudential standards Namfisa aims to promote prudent behaviour by financial institutions and ensure that the risk they take is within reasonable bounds, clearly identified and well managed,’ Brandt said.jo-mare@namibian.com.na

Stay informed with The Namibian – your source for credible journalism. Get in-depth reporting and opinions for only N$85 a month. Invest in journalism, invest in democracy –
Subscribe Now!

Latest News