46 000 jobs through Agribank

Agribank says by creating about a third of all jobs in the agricultural sector, it plays a vital role in poverty alleviation.

26 September 2019 | Banking

ELLANIE SMIT



Agribank has created or maintained 46 816 direct jobs in the agriculture sector during the 2018/19 financial year, compared to 45 232 jobs during the previous financial year.

“By creating about a third of all jobs in the agricultural sector, the bank plays a very important role in income generation and poverty alleviation,” Agribank CEO Sakaria Nghikembua said.

Nghikembua said yesterday the bank recently announced a solid set of results for the year ending 31 March 2019, following its annual general meeting (AGM).

He said despite the difficult operating environment, characterised by severe drought and an economy in recession, the bank delivered a healthy set of results.

Nghikembua said the bank's total assets grew by nearly 7% year-on- year, exceeding the N$3 billion mark for the first time in its history.

Total assets stood at N$3.011 billion at the end of March this year, compared to N$2.82 billion the year before.

According to Nghikembua the bank’s loan book grew by 15% year-on-year, from N$2.4 billion in 2018 to N$2.8 billion in 2019, while arrears stood at about N$530 million.

He said the growth in the loan book came largely on the back of new business growth.

Loan disbursements were 22% up from the previous year, increasing from N$358 million in 2018 to N$438 million in 2019.

Of the N$438 million, a total of N$41 million was disbursed exclusively to female clients, compared to the N$42 million in 2018, while N$50 million went to youth (below 40) in 2019, compared to N$98 million in 2018.

A total of N$30 million was disbursed to communal farmers without collateral in 2019, compared to the N$26 million in 2018.

Nghikembua said as a result of the increase in loan disbursements, interest income grew 14.5% from N$189 million in 2018 to N$216 million in 2019.

Expenses were well-contained at a growth of 4.4%, while the bank's surplus increased 87% from N$30 million in 2018 to N$56 million in 2019.

Expenses decreased from 10% and 17% in 2015 and 2016, respectively, to 11% in 2017, 7.8% in 2018 and 4.4% in 2019.

Nghikembua explained that the bank’s major expenses are staff, professional services, consultancy services for audits, computers and travel and accommodation.

He said the bank continued to roll out its salary-backed no-collateral product for communal farmers, disbursing N$26 million in new loans.

Since April 2017, the bank has disbursed a total of N$61 million in these loans to communal farmers.

In addition, the bank also introduced a no-collateral loan product for full-time communal farmers called the emerging retail financing product (ERFP) in May 2018. A total of N$4.5 million was disbursed to communal farmers under this product during the financial year.

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, implements and fencing, amongst others.

Nghikembua said the arrears ratio has also been reduced from 20.2% in 2016 to 19% this year. According to him the bank aims to reach 15% by 2020, which is the benchmark for financial institutions.

During the same period, 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.

The bank made use of external collectors during various periods and collected N$11.5 million in 2017, N$82.4 million in 2018 and N$4.3 million this year. Currently, the bank is making use of internal staff.

“Despite the current depressed economic and harsh climatic environments, reasonable progress continues to be made on the collections front, as more customers positively respond to the bank’s call to service their loan accounts.”

Nghikembua said clients have become increasingly supportive.

He stressed there is still critical work that remains and this includes reducing arrears to cement sustainability. He said the bank is dealing with loans that have sometimes been arrears for up to 10 or 15 years.

The bank also took 6 453 farmers and farming employees through its training and mentorship interventions in 2019.

Similar News

 

A fruit of hope

2 days ago - 15 November 2019 | Banking

Mariselle StofbergDespite challenging economic conditions, the Cancer Apple Project, which has impacted the lives of numerous Namibians, has managed to raise N$2.5 million in aid...

SME Bank creditors to be paid

5 days ago - 12 November 2019 | Banking

CATHERINE SASMANThe Master of the High Court has authorised the first creditors’ meeting and first members’ meeting of the SME Bank in liquidation. The meeting...

Attachments a last resort - Agribank

1 week ago - 06 November 2019 | Banking

Agribank says when it attaches the property of borrowers it is always as a last resort.“We have a collections policy which is underlined by a...

Reaping the fruits of hard work

2 weeks ago - 01 November 2019 | Banking

Evany van Wyk Christall Farmer’s childhood dream was to become a lawyer. She realised, however, that being a lawyer could compromise her integrity and...

Uanguta seconded to Namra

2 weeks ago - 01 November 2019 | Banking

Bank of Namibia (BoN) deputy governor Ebson Uanguta has been appointed to serve as the temporary CEO of the soon-to-be established Namibia Revenue Agency (Namra)....

FNB invests in health

2 weeks ago - 01 November 2019 | Banking

ESTER KAMATI First National Bank Namibia donated a blood-gas analyser worth N$282 000 to the Windhoek Central Hospital's cardiac unit this month.The unit, which treats...

Prime interest rate remains the same

3 weeks ago - 23 October 2019 | Banking

The Bank of Namibia (BoN) this morning left its repo rate unchanged at 6.5%.The decision was taken in view of global, regional and domestic economic...

SME Bank: Money laundering exposed

1 month - 02 October 2019 | Banking

A company called Omulunga Capital Investments CC, of which Zimbabwean Cosmas Mushininga is the sole director, was placed under provisional liquidation by the High Court...

Money transfers a tedious exercise

1 month - 27 September 2019 | Banking

Since Monday this week, cross-border electronic fund transfers (EFTs) are being more closely controlled and restricted. Contrary to an earlier statement by the Bankers Association...

Iipumbu paid for his Porsche

1 month - 26 September 2019 | Banking

On September 12, Namibian Sun reported on a N$4.8 million claim by Agribank against its former CEO, Leonard Iipumbu, for unpaid loans against farmland, as...

Latest News

August 26 CEO innovates

2 days ago - 15 November 2019 | Business

Elizabeth Joseph ...

Fishing quotas under scrutiny

2 days ago - 15 November 2019 | Fishing

President Hage Geingob and acting fisheries minister Albert Kawana will meet next week to discuss the credibility of the fishing quota allocation process, as well...

Geingob was 'talked out of'...

2 days ago - 15 November 2019 | Government

President Hage Geingob had written dismissal letters for ministers Sacky Shanghala and Bernhard Esau on Wednesday morning, but a high-level meeting that included Vice-president Nangolo...

Helping people help themselves

2 days ago - 15 November 2019 | People

Evany van WykMarjolize Scholtz has been a wellness professional for over 17 years. During her career her empathy towards people has grown immensely. Scholtz was...

Putting on a corporate...

2 days ago - 15 November 2019 | People

Elizabeth Joseph Margaret Thatcher once quipped that if you want something said, ask a man. If you want something done, ask a woman. Langford...

Fuelled by ­creativity

2 days ago - 15 November 2019 | People

Evany van Wyk “Every challenge is put on your path to groom you and build you and if I had the opportunity to change something...

A musician at heart

2 days ago - 15 November 2019 | People

Queen, Mumford and Sons, as well as Koos du Plessis are all musical influences that Ruan Greeff, or John Rock Prophet as you may know...

EVMs in the firing line

2 days ago - 15 November 2019 | Politics

Independent president candidate Panduleni Itula, the Electoral Commission of Namibia (ECN) and Swapo will square off in the electoral court on Tuesday, 19 November over...

Unshackling the toothless ACC

2 days ago - 15 November 2019 | Opinion

Much has been said about the Anti-Corruption Commission (ACC) over the years. Many have called it toothless.Revelations this week that it has been sitting on...

Load More