EDITORIAL: DBN losses cause for concern

Revelations by the Development Bank of Namibia (DBN) this week that it recorded losses of N$250 million for the year ended March 2023 must be treated as a major cause of concern.

For years, we have heard how the politically-connected and their cronies have amassed wealth by getting loans from DBN and failing to honour their repayment obligations.

This sets a bad tone for those beneficiaries who diligently repay their loans in order to keep the bank afloat, and subsequently help other Namibian businesses that are in need of capital to operate and create the much-needed jobs.

We cannot allow another Government Institutions Pension Fund (GIPF) scenario where N$660 million vanished into thin air.

Already, the national budget does not make much provision for development projects because most of it is gobbled up by operations. In fact, we have seen over the years how the development spending of the nation has been significantly dwarfed by government’s operational budget.

It is crucial that we safeguard the existence of development financing entities such as DBN if we want to see true economic growth going forward.

DBN must also take part of the blame for the mega losses recorded as this speaks to poor due diligence before loans are dished out and shoddy loan recovery mechanisms.

We are cognisant that Covid-19 hit businesses hard, but the leadership of the bank must take stock of where they went wrong in order to improve the system and ensure it is watertight.