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Agribank announces comprehensive COVID-19 relief and stimulus package

Premier agricultural lender, Agribank, has announced a package of relief and stimulus measures, which come into effect on 1 June 2020. The package was developed after an extensive consultation process with key stakeholders in the agricultural sector, as well as the bank’s shareholder.

The package consists of the following measures:

(a) Instalment relief – to qualify, clients will have to apply for the relief and demonstrate that they have been affected by COVID-19. Clients will be treated on a case-by-case basis upon merit. The instalment holiday will be for a period of 12 months. This means that from 1 June 2020 to 31 May 2021, Agribank clients who will qualify for this relief measure will not be mandated to pay their annual instalment. The repayment holiday applies to capital and interest on that instalment. The instalment will be capitalized, and an additional year will be added to the client’s loan term. Clients receiving the relief, who wish to keep to their original loan term, are free to do so. Existing arrears will not be capitalized but the penalty interest applicable to such arrears will be reduced from 2% to 1.5% during the relief period (i.e. the 12 months) after which period the penalty interest will revert to the original 2%. If a client has qualified for relief, the instalment holiday will apply to all loans which a client might have with the bank. Normal loan payments will resume after the instalment holiday period. Full collateral cover of the loans is to be maintained. Application forms will be available at all Agribank branches as well as on-line on the bank’s website.

(b) Interest rate relief – interest rates for the different bank products will be adjusted as follows:
(i) Rates above 8.5% will be reduced by 0.5%
(ii) Rates between 8.1% and 8.49% will be reduced to 8%
(iii) Rates below 8% will remain as is
(iv) Penalty interest on arrears will be reduced from 2% to 1.5% during the relief period, where-after such penalty interest will revert to 2%

(c) Stimulus loans – the bank is in the process of finalising funding arrangements to provide loans to farmers and agri-businesses to the value of N$200 million to stimulate production and help farmers to diversify income streams for enhanced resilience to be able to withstand variable weather conditions and pandemics such as COVID-19. Clients are advised that the commencement date of such stimulus loans will be announced in due course. The usual prudent and risk-based credit assessment criteria will apply, as do normal terms and conditions of these loans. The stimulus loans carry a grace period in line with the production cycle of the intended use of the loan. The maximum grace period is 12 months from the date of loan disbursement. Normal loan recovery procedures will apply to defaulting clients after the grace period.

(d) ITC de-listing and restructuring – the following measures will also come into effect:
(d.1) For pre-legal clients – de-listing will be done on payment of 10% of the client’s arrears; whilst restructuring of any of the client’s loan accounts will be effected on payment of 20% of the arrears. This means that a client wishing both to be de-listed and restructure their loan, will be required to pay 20% of their arrears prior to de-listing and restructuring. Viability of the farming business after restructuring must be proven as part of the assessment process. On successful restructuring of a loan account, bank policy allows for an additional 2 years to be added to the loan term.
(d.2) For legal clients – de-listing will be done on payment of 10% of the client’s arrears. A client will pay 20% of their arrears for restructuring if such a client is up to date with their repayment arrangement; if not up to date with repayment arrangements, the client will be expected to pay 30% of their arrears before restructuring can be implemented. The viability of the client’s farming business must be proven and a business plan of how such a business will be turned-around is required. An extension of up to 2 additional years can be made to the term of a restructured loan.
(e) Legal action – the following provisions will apply:
(e.1) if default judgment has already been obtained against a client – the bank will pend further action if COVID-19 impact is proven or upon successful restructuring in line with the guidelines above (in (d)).
(e.2) if legal action has started but not yet completed – the bank will pend legal action subject to the client consenting in writing to judgment and proof of COVID-19 impact or applicable down-payment on the arrears for restructuring (see (d)).
(e.3) if legal action has not yet started – the bank will not institute action if the impact of COVID-19 is proven or upon applicable down-payment on the arrears for restructuring (see (d))
As a caring partner, Agribank would like to invite farmers to make use of the relief and stimulus measures put in place. We see this an opportunity for our clients to re-set their farming business operations and are pleased to be able to extend a helping hand to them in these challenging times.

Issued by:
Sakaria Nghikembua
For enquiries, kindly contact the Marketing and Communication Division at:
Tel.: 061 2074332
Cell: 0817684165

Covid-19 Office Lockdown Notice

Agribank wishes to advise its stakeholders that all its offices
countrywide will be closed for business from 26 March until 14 April
2020, in line with additional measures announced by the
Government to combat COVID-19.

For more info, Click on the link below

Covid-19 Office Lockdown Notice

Bank's operations during Corona virus outbreak

As part of our efforts to control the spread of the coronavirus, we would like to advise our clients to, as much as possible, use emails, telephone calls or other electronic channels should they wish to make queries with the Bank.

However, we remain open to receive and engage with our clients for transactions that require person-to-person interactions. This advice is in the interest of both clients and the Bank’s employees.

We invite you to join in efforts to fight and control this global pandemic that has also affected our country.

Thank you in advance for your support.

Issued by:

Rino Muranda
Manager: Marketing and Communication
For enquiries, kindly contact the Marketing and Communication Division at:
Tel.: 061 2074332
Fax: 061 2074206

Agribank rated as best performing Development Finance Institution

Agribank achieved an overall score of 81% and obtained an A rating at the 9th Peer Review of the Association of African Development Finance Institutions (AADFI). A total of 38 development finance institutions submitted their externally audited prudential ratings for assessment on standards of governance, financial prudence and operations.

Agribank was classified as Best Performing African Development Finance Institution (DFI) with a rating of A and will be presented with the prestigious award for 2019 at the General Assembly of the AADFI in Abidjan, Ivory Coast later this year.

AADFI Chairman Thabo Thamane, congratulated the Agribank Board, Management and staff for the record performance and urged the Bank “not to relent in its efforts to entrench best practices in its operations”. Thamane added that the Bank should “continue to sustain its development financing mandate.”

On his part, Agribank chief executive officer, Sakaria Nghikembua, expressed delight at the achievement, noting that the bank has embedded good practices in governance, as well as in financial and operational management. “We will continue to implement these practices to ensure that the bank is not only sustainable, but that it delivers on its core mandate of economic upliftment and contributing towards food security at both the household and national levels.”

Issued by:
Rino Muranda
Manager: Marketing and Communication
For enquiries, kindly contact the Marketing and Communication Division at:
Tel.: 061 2074332
Fax: 061 2074206

Agribank delivers solid results

Premier agricultural lender, Agribank, recently announced a solid set of results for the year to 31 March 2019. Speaking after the bank's annual general meeting, chief executive officer Sakaria Nghikembua announced that despite the difficult operating environment, characterised by a severe drought and an economy in recession, the bank delivered a healthy set of results.

According to Nghikembua, Agribank's loan book grew year on year by 15 per cent, from N$2.4 billion in 2018 to N$2.8 billion in 2019. The growth in the loan book came largely on the back of new business growth. Disbursements were 22 per cent 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. In general, 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 per cent whilst the bank's surplus increased 87 per cent from N$30 million in 2018 to N$56 million in 2019.

The Bank's total assets exceeded grew by nearly 7 per cent year on year and, exceeding the N$3 billion-dollar mark for the first time in history. Total assets stood at N$3.011 billion at the end of March 2019 compared to N$2.82 billion the year before whilst net assets grew 6.1 per cent from N$2.33 billion in 2018 to N$2.44 billion in 2019.
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. 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 launch in April 2017, the bank has disbursed a total of N$61 million in salary-backed no-collateral loans to communal farmers. In addition, the bank also introduced a no collateral loan product for full time communal farmers called emerging retail financing product 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.

The bank created and/or maintained 46,816 direct jobs in the agriculture in 2019, compared to 45,232 jobs in 2018. The bank thus plays a very important role in job creation, income generation and poverty alleviation. As part of its corporate social investments drive, the bank took 6453 farmers and farming employees through its training and mentorship interventions in 2019, registering a 27 per cent increase on the 5091 beneficiaries in 2018. The bank continued to sponsor three students in veterinary medicine, crop science and animal science at the University of Namibia 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. The rate of growth in interest income has changed from low levels on 1 per cent in 2015 and 2016 to 6.4 per cent in 2017, 12.8 per cent in 2018 and 14.5 per cent in 2019. The rate of growth in expenses on the other hand had decreased from high levels of 10 per cent and 17 per in 2015 and 2016 respectively to 11 per cent in 2017, 7.8 per cent in 2018 and 4.4 per cent in 2019. 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. Despite the current economic and climatic environment, reasonable progress continues to be me on the collections front as more customers positively respond to the call to service their loan accounts.

The bank's prudential ratings score has improved from 65 per cent in 2016 to 81 per cent in 2019, indicating demonstrable progress in governance, financial management and operational standards. The ratings are externally audited. Commenting on the bank's trajectory chief executive officer Sakaria Nghikembua indicated that despite environmental and internal legacy challenges, the bank is making good and rapid progress, stating 'good leadership at board level has been critical in ensuring we have the right strategy and the right people to make a difference. As the statistics show, the improvements have been all-round. We know it's been a challenging road and it will remain so for a long time yet but we are relishing the opportunity to serve and make a lasting impact by running a sustainable organisation’.

Issued by:
Sakaria Nghikembua
Chief Executive

For enquiries, kindly contact the Marketing and Customer Strategy Department at:

Tel.: 061 2074279 / Fax: 061 2074206

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