Interest Rate Relief for Namibians

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By Emma Kakololo

WINDHOEK

Standard Bank of Namibia has decided to leave the bank rate unchanged at 10.50 percent, despite the South African Reserve Bank (SARB) increasing the repo rate to 11.00 percent effective December 7, 2007.

The bank’s prime lending rate also remains unchanged at 15.25 percent as well as the home loan base rate and vehicle and asset finance rates.

Announcing its decision on Friday not to increase rates, the Bank’s Managing Director, Mpumzi Pupuma said: “The Bank of Namibia noted that the Namibian economy continued to perform satisfactorily, supported by robust growth in the world economy and higher commodity prices.

“Growth in credit extension to the private sector remains high, but the rate of increase is slowing down, which may indicate that the private sector credit demand may be responding to the tightened monetary policy.”

Pupuma said they were content with the decision, as customers have been hit hard with increases over the past year, not just in terms of the interest rate.
Consumers have also been affected by the ever-increasing petrol and diesel prices, which have an impact on the price of consumer goods as Namibia still imports the bulk of its goods from South Africa.

“Inflation in Namibia has continued its downward trend, easing since August 2007 and we have therefore been awarded this Christmas present by the Bank of Namibia, which we are happy to pass on to all our customers.”

Major banks in South Africa have already increased their rates as from last Friday. The prime overdraft rate at Absa, Nedbank and Old Mutual Bank rose on Friday by 0,5 percentage points – from 10,5 percent to 11 percent.

First National Bank South Africa’s prime overdraft rate is expected to increase today, while that of Standard Bank would rise on Wednesday.