Namibian individuals secure over N$2b in credit over 12 months

The private sector in Namibia received a total of N$3.73 billion in credit over the past 12 months.

According to the latest data with individuals accounted for N$2.07 billion and corporations secured N$1.66 billion.

IJG Securities says private sector credit extension rose by 0.8% month on month in November 2024, equivalent to N$908.8 million. This brought the annual growth rate down to 3.3%.

“After adjusting for interbank swaps recorded by the Bank of Namibia (BoN) under non-resident private sector claims, the normalised cumulative credit outstanding stood at N$116.3 billion,” says IJG.

Credit extended to individuals increased by 3.1% year on year in November. Overdraft facilities for individuals recorded a 0.4% y/y increase, while mortgage loans rose modestly by 1% y/y.

“Other loans and advances, including credit cards, personal loans and term loans saw an 8.0% y/y rise. However, the growth rate of instalment credit slowed to 9.7% y/y,” says the firm.

Meanwhile, credit extended to corporates slowed in November, with annual growth easing to 3.6% y/y compared to 4.4% y/y in October.

“The deceleration was primarily driven by reduced credit demand from companies in the real estate sector. Corporate overdrafts continued to contract, posting an 8.8% y/y decline, while mortgage loans fell by 3.9% y/y,” notes IJG.

In contrast, other loans and advances increased by 11.9% year on year and instalment credit registered another substantial rise of 21.3% y/y.

The firm notes that the subdued growth in corporate credit highlights the continued muted demand for credit within this sector.

This comes as commercial banks’ overall liquidity increased by N$1.48 billion in November, averaging N$8.14 billion compared to N$6.65 billion in October.

Higher diamond sales primarily drove the increase during the month.

On the other hand, in November, international reserves fell by N$45 million, reaching N$60.8 billion. This level continues to provide 4.1 months of import cover, unchanged from the previous month.

“The BoN attributed the decline mainly to higher net outflows from commercial banks, partially offset by increased customer foreign currency placements, leading to a slight drop in the reserve stock,” says IJG.
– The Brief