Loans to individuals, businesses up N$750m
04 January 2019 | Economics
On a year-on-year basis (2017 to 2018), total private sector credit extension (PSCE) grew by almost 8% in November compared to 7.8% year-on-year in October IJG noted.
“November has also been the fourth consecutive month in which PSCE growth has kept raising on a year-on-year basis. Cumulative private sector credit outstanding as at the end of November amounted to N$96.645 billion,” IJG said.
IJG also found that on an annual basis, households were taking up much of the credit extended to the private sector in 2018, accounting for almost two-thirds of the uptake.
However, that wide disproportion between credit extended to households and corporations began to narrow in August. On a rolling 12-month basis N$7.1 billion worth of credit was extended to the private sector with N$3.26 billion being taken up by households. Corporations very nearly equalled that which was extended to households by taking up N$3.21 billion worth of the credit over the last 12 months, while claims on non-residents totalled N$663.2 million. In terms of credit extended to corporates and businesses, this increased by 8.9% year-on-year compared to October's 7.1% year-on-year increase IJG noted.
“The November increase in corporate credit has been the highest since March 2017 and the fifth consecutive month in which corporate credit has been increasing at a faster pace on a year-on-year basis. Shorter-term credit facilities continue to be driving the increase in corporate credit extension,” IJG said. Overall PSCE growth in November maintained its upward momentum on a year-on-year basis for a fourth consecutive month, increasing by 7.96% year-on-year IJG noted, which it said was the highest rate of growth in the last 18 months.
In the midst of recessionary economic growth short-term and unsecured loans have grown at a quicker rate than that of mortgage and instalment credit, IJG said.