Agribank battles rising defaults as loan book tops N$3.1b
Staff ReporterWINDHOEK
Agribank ended its 2024 financial year with a net loss of N$19 million – its first in five years – as rising arrears and credit impairments negatively impacted its performance.According to the bank’s 2024 annual report released early this year, this loss occurred despite net interest income reaching a five-year high of N$226 million and loans advanced increasing to N$370 million, a 26% rise from the previous year.
Agribank indicated in earlier reports that it supported over 46 000 direct agricultural jobs in 2019 and provided mentorship to more than 6 000 farmers and farmworkers.
The bank’s loan book climbed to N$3.1 billion, but the arrears-to-advances ratio surged to 34%, meaning over a third of the portfolio was not being repaid on schedule.
Credit impairments spiked to N$65 million, while employee costs, the bank’s largest expense, rose steadily to N$122 million.
Omaheke and Khomas lead
Despite expanding lending, with N$58.3 million disbursed to youth farmers and the Omaheke and Khomas regions leading, non-performing loans continued to weigh heavily on profitability.
Agribank now accounts for 47% of Namibia’s agricultural debt.
In 2023, the bank reported a modest profit of N$31 million, down from N$32 million in 2022, as loan growth stagnated at around N$2.9 billion and arrears increased from 31% to 33%.
To address unpaid loans, Agribank intensified debt recovery efforts, prioritising dialogue, loan restructuring and negotiated repayment plans.
Farm repossession remains a last resort – only three farms were auctioned over the past decade.
By the end of 2024, arrears still exceeded N$1 billion.
Over the period 2020–2024, government injected N$442 million in equity, reducing Agribank’s reliance on debt financing by cutting borrowings from N$1.05 billion to N$587 million.
Founded in 1991 to succeed the Agricultural Credit Board, Agribank’s mandate includes financing farming, land reform and rural development.
It provides loans for farmland acquisition, livestock, crops, horticulture and agribusiness, and has recently focused on youth and women.
It remains a commercial state-owned enterprise governed by the Agribank Act of 2003 and supervised by the finance ministry.
Witvlei abattoir
A long-standing challenge for Agribank has been the underutilised Witvlei abattoir in the Omaheke region. Once a thriving export beef facility, it has been inactive for years amid a legal dispute and financial strain.
Agribank has now put the facility on the market, inviting offers of around N$52 million.
The abattoir was once a key beef export facility capable of slaughtering up to 27 000 cattle per year and employing over 200 people.
Operated by Witvlei Meat from 2006, it gained EU export approval but closed in 2014–2015 after Namibia’s quota to Norway was sharply reduced.
The closure led to significant job losses and economic decline in the surrounding rural community.
The abattoir was built and financed by Agribank, which later repossessed it after a failed sale and a protracted legal battle with the operator.
Despite receiving offers of up to N$40 million in 2022 and listing the property at around N$51.7 million, Agribank has yet to conclude a sale.
The facility remains idle, but its reopening could restore hundreds of jobs and stimulate the regional agricultural economy, making it a recurring subject of parliamentary and public interest.
Agribank ended its 2024 financial year with a net loss of N$19 million – its first in five years – as rising arrears and credit impairments negatively impacted its performance.According to the bank’s 2024 annual report released early this year, this loss occurred despite net interest income reaching a five-year high of N$226 million and loans advanced increasing to N$370 million, a 26% rise from the previous year.
Agribank indicated in earlier reports that it supported over 46 000 direct agricultural jobs in 2019 and provided mentorship to more than 6 000 farmers and farmworkers.
The bank’s loan book climbed to N$3.1 billion, but the arrears-to-advances ratio surged to 34%, meaning over a third of the portfolio was not being repaid on schedule.
Credit impairments spiked to N$65 million, while employee costs, the bank’s largest expense, rose steadily to N$122 million.
Omaheke and Khomas lead
Despite expanding lending, with N$58.3 million disbursed to youth farmers and the Omaheke and Khomas regions leading, non-performing loans continued to weigh heavily on profitability.
Agribank now accounts for 47% of Namibia’s agricultural debt.
In 2023, the bank reported a modest profit of N$31 million, down from N$32 million in 2022, as loan growth stagnated at around N$2.9 billion and arrears increased from 31% to 33%.
To address unpaid loans, Agribank intensified debt recovery efforts, prioritising dialogue, loan restructuring and negotiated repayment plans.
Farm repossession remains a last resort – only three farms were auctioned over the past decade.
By the end of 2024, arrears still exceeded N$1 billion.
Over the period 2020–2024, government injected N$442 million in equity, reducing Agribank’s reliance on debt financing by cutting borrowings from N$1.05 billion to N$587 million.
Founded in 1991 to succeed the Agricultural Credit Board, Agribank’s mandate includes financing farming, land reform and rural development.
It provides loans for farmland acquisition, livestock, crops, horticulture and agribusiness, and has recently focused on youth and women.
It remains a commercial state-owned enterprise governed by the Agribank Act of 2003 and supervised by the finance ministry.
Witvlei abattoir
A long-standing challenge for Agribank has been the underutilised Witvlei abattoir in the Omaheke region. Once a thriving export beef facility, it has been inactive for years amid a legal dispute and financial strain.
Agribank has now put the facility on the market, inviting offers of around N$52 million.
The abattoir was once a key beef export facility capable of slaughtering up to 27 000 cattle per year and employing over 200 people.
Operated by Witvlei Meat from 2006, it gained EU export approval but closed in 2014–2015 after Namibia’s quota to Norway was sharply reduced.
The closure led to significant job losses and economic decline in the surrounding rural community.
The abattoir was built and financed by Agribank, which later repossessed it after a failed sale and a protracted legal battle with the operator.
Despite receiving offers of up to N$40 million in 2022 and listing the property at around N$51.7 million, Agribank has yet to conclude a sale.
The facility remains idle, but its reopening could restore hundreds of jobs and stimulate the regional agricultural economy, making it a recurring subject of parliamentary and public interest.
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