Kuzeeko Tjitemisa
WINDHOEK – The governmentowned Agricultural Bank of Namibia (Agribank) chief executive officer (CEO) Sakaria Nghikembua says the bank through its lending activities has created 1 584 direct jobs in the agricultural sector in 2019.
Nghikembua, who was speaking at the bank’s annual general meeting in the capital yesterday, said the bank which plays a very important role in income generation and poverty alleviation created 46 816 direct jobs in agriculture in 2019, compared to 45 232 jobs in 2018.
He said the bank continued to roll out its salary-backed no-collateral product for communal farmers, disbursing N$26 million in new loans for this product during the year. Since the launch of salary-backed nocollateral products for communal farmers in April 2017, Nghikembua said, the bank has
disbursed a total of N$61 million. In addition, he said the bank also introduced a no-collateral loan product for full-time communal farmers called emerging retail financing product (ERFP) in May last year.
Under the ERFP, Nghikembua said a total of N$4.5 million was disbursed to communal farmers during the financial year. He explained that the introduction of the two no-collateral loan products makes it possible for communal farmers to access funding for agricultural purposes with clients using the loans for livestock acquisition, water and electricity infrastructure, tractors and implements and fencing amongst other needs.
Furthermore, Nghikembua said Agribank’ s loan book grew by 15 percent year on year, from N$2.4 billion in 2018 to N$2.8 billion in 2019.
He attributed the growth in the loan book to new business growth. “Disbursements were 22 percent up on
prior year, increasing from N$358 million in 2018 to N$438 million in 2019. As a result, interest income grew 14.5 per cent from N$189 million in 2018 to N$216 million in 2019,” he explained.
He said provisions for bad debts on loan advances were well contained partly because of a steady hold on the collections rate and largely because of ensuring sufficient collateral cover for high-risk loan accounts.
“Expenses were well contained at a growth of 4.4 percent whilst the bank’s surplus increased 87 percent from N$30 million in 2018 to N$56 million in 2019,” he said. He said the bank’s total assets grew by
nearly seven percent year on year, exceeding the N$3 billion dollar mark for the first time in history.
According to him, total assets stood at N$3.011 billion at the end of March 2019 compared to N$2.82 billion the year before. Turning to key strategic actions during the year, Nghikembua stated that the
bank opened a branch office in Gobabis in Omaheke Region as part of its strategy to be accessible to its customers. As part of its corporate social investments drive, he said the bank took 6 453 farmers
and farming employees through its training and mentorship interventions in 2019, registering a 27 percent increase on the 5 091 beneficiaries in 2018.
At the same time, he said the bank also continued its sponsorship of three students doing veterinary medicine, as well as crop and animal sciences at the University of Namibia (Unam) whilst also investing in its employees through leadership development and skills-specific programmes.
“Medium-term trends demonstrate that the bank is firmly on a positive trajectory,” he said, adding that the rate of growth in interest income has changed from low levels on one percent in 2015 and 2016 to
6.4 percent in 2017, 12.8 percent in 2018 and 14.5 percent in 2019.
“The rate of growth in expenses on the other hand has decreased from high levels of 10 percent and 17 percent in 2015 and 2016 respectively to 11 percent in 2017, 7.8 percent in 2018 and 4.4 percent in 2019,” he said.
During the same period, Nghikembua said the bank registered a consistently increasing surplus position, in line with its sustainability strategy. “Collections have steadily grown from N$157 million in 2015 to N$296 million in 2019,” he said.