News & Media

Response to questions via The Patriot newspaper

Response to Questions via The Patriot newspaper


1. Farmers from previously disadvantaged backgrounds have complained that Agribank is taking time to declare the drought a national crisis. They are questioning why you are not taking the lead to influence government to make the declaration. Why has the bank not yet done this?
It is not Agribank’s mandate to declare a drought in the country, least of all to declare the drought as a national crisis. It is also not the bank’s responsibility to influence the government to declare the drought or to declare it as a national crisis. The mandate to declare droughts in the country lies with the government. Farmers belong to farmers’ unions and these would be the correct structures which they should use to lobby government for purposes of declaring a drought in the country. The bank’s mandate is to finance agriculture, including initiatives aimed at coping with the drought, such as providing loans for fodder, water infrastructure, irrigation infrastructure, creating alternative income streams such as wood and charcoal production and similar drought-mitigating measures.

2. Secondly, they want the bank to suspend the collection of loans from them till the drought is over. What is the bank’s position on this?
The bank cannot accede to such a request on a wholesale basis. We wish to once again advise our clients to contact the bank and make appropriate repayment arrangements based on their specific circumstances. It is best that such an approach is made early. In an interview with a local newspaper last week, the Agribank chief executive officer indicated that the bank was finalising some drought assistance measures and that these will be announced in due course when finalised. It is however important to under-score that any such measures will be severely constrained by clients’ poor repayment record. The bank does not have access to unlimited cash resources and solely relies on what it collects back from clients to disburse anew. In the absence of such repayments, the bank cannot make new disbursements.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Agribank’s top leadership pays a courtesy visit to the Prime Minister

Prime Minister Saara Kuugongelwa-Amadhila has urged Agribank to continue with targeted stakeholder engagements with its strategic stakeholders to create a shared understanding about its operations and activities. The Premier expressed these sentiments at a stakeholder meeting held recently between her office, the Minister of Finance and Agribank Board and Management. She noted that Agribank plays a critical role in the agricultural sector as it is “for everyone from senior citizens, ordinary person to a child under the bridge”. Whilst appreciating the efforts of the bank, Kuugongelwa–Amadhila called for synergy between Agribank and Government institutions to ensure the activities are aligned in order to achieve the national developmental goals.

On his part, Agribank Chief Executive Officer Sakaria Nghikembua presented a brief overview on the mandate of the bank, product portfolio, farmers training and mentorship, financial status, available funding options as well as corporate social investment of the Bank. Nghikembua highlighted some of the challenges facing the Bank and possible solutions as well as the role that it plays in the country’s land reform process. “We have many social responsibility programs and one of them is that we are currently having four students on our bursary scheme, we also offer training and mentorship to farmers among others,” he said. According to Nghikembua, Agribank can be the center of enabling land reform in the country and transformation of agricultural sector in general, if sufficient support is provided by the relevant stakeholders.

The stakeholder meeting was attended by the Prime Minister, Minister of Finance, Calle Schlettwein, Executive Director in the office of the Prime Minister I-Ben Nashandi as well as AgribankBoard and members of Senior Management. The meeting was held as part of Agribank’s stakeholder engagement strategy which employs multiple engagement methods including one-on-one meetings with strategic stakeholders.

Issued by:

Sakaria Nghikembua
Chief Executive Officer
For enquiries, kindly contact the Marketing and Communication Division at:
Tel.: 061 2074332
Fax: 061 2074206


Caption:
Agribank CEO Sakaria Nghikembua, Board member Dagmar Honsbein, Agribank Chairperson Michael Iyambo, Prime Minister Saara Kuugongelwa-Amadhila, Finance Minister Calle Schlettwein, Board members Peyavali Hangula and Phanuel Kaapama pictured after the courtesy visit.

Agribank response to questions & issues raised

Response to Questions Raised via the Windhoek Observer
There are various ‘concerns’ allegedly raised by some concerned farmers related to Agribank that have been circulating on various social media platforms. In addition, we have been approached by the Windhoek Observer with questions about similar issues to which we have provided detailed response.

1) Why is the bank resorting to black listing farmers on the ITC, thereby crippling them financially and how does this address the bank’s efforts to recover its funds?
Listing is done in compliance with, and within the provisions of, the Credit Bureau Regulations as enforced by the Bank of Namibia to which Agribank is required to adhere like any other credit provider. Credit listing is only done as a mechanism of last resort for clients who repeatedly fail to honour their repayment obligations. The debtor is typically de-listed as soon as they have brought their account up-to-date. It should be pointed out that even retailers black list clients for relatively small credit balances, as do micro-lenders and commercial banks. It is the bank’s experience that clients take their repayment obligations more seriously when listed. It is very unfortunate that the bank is forced to take this step in respect of some of its clients who are in arrears. Clients that cooperate with the bank proactively have no reason to be concerned that they would be listed on ITC. In addition, the bank subscribes to ITC and uses this information to do credit checks as part of the approval process. Thus the importance of complete and accurate information provided to ITC by all credit providers cannot be overemphasised.

2) Agribank launched various initiatives to address land ownership imbalances in the country. Does your current aggressive approach in recovering funds owed from black farmers address this initiative?
We must correct the statement. Firstly, the approach we are following cannot be termed aggressive at all. In fact, the opposite is true and the bank is the most accommodative lending institution in the market. Secondly, the reference to black farmers is misleading as all clients are expected to honour their repayment obligations. The bank does not discriminate. Thirdly, you are right that the bank has put substantial commercial farm-land into the hands of previously disadvantaged Namibians, over 6 million hectares having been placed in such hands since independence through the bank’s financing and developmental objectives. The bank continues to play its role in pursuit of this national objective. In fact the bank is heavily reliant on clients repaying their debt to be able to pursue this objective. Simply put, the bank needs the cash inflows to be able to fund new loans at terms far more beneficial than farmers would otherwise have access to.

3) Why has the bank resorted to debt takeovers when black farmers fail to pay what is due and what criteria are you using to identify which debt can be taken over?
If the question is about clients who move their loans from commercial banks to Agribank, the normal credit assessment criteria applies. Many clients looking to move over to Agribank do so because of more favourable loan terms than those offered by commercial banks. Funding clients who wish to move over from commercial banks is not a new practice for the bank as the debt take-over product has been in existence for many years.

4) Farmers are raising concern that the recruitment of three white executives in the bank has worsened relations with them because of the handling of their issue and also allegations these are former colleagues of the current CEO?
It is easy to twist facts. The truth is simple. Firstly, the bank does not follow a policy of racial discrimination in its recruitment practices. Secondly, the CEO does not appoint executives in the bank. These are appointed by the Board following a rigorous recruitment process that delivers the most suitable people for each role. Thirdly, only two of the three people worked previously for the same employer as the CEO. They applied for positions that were advertised, just like others who responded to such advertisements. Fourthly, the credentials of these employees would clearly demonstrate that they are highly skilled, qualified and experienced professionals who are best suited for the roles they were appointed into by the Board. The bank needs the best people to escape the damage of many years; and for it to be sustainable. Fifthly, it is false to assert that these executives have worsened relations with the concerned farmers. The bank’s collections strategy was developed, approved and implemented well before any of these employees joined the bank; and none of these executives is at the forefront of collections. They cannot be made scape-goats. One of these employees only joined the bank in March 2019. How would he have contributed to the worsening of relations with any of the concerned farmers, for example? The bank has, indeed, begun to realise value from the recruitment of these professionals as evidenced in the progress it is making on various critical fronts. Sixthly, the allegation conveniently ignores black executives at the bank and creates an impression of racial imbalance. The CEO is black. The executive for credit is black. The executive for marketing and customer strategy is black. The executive for human resources is a black woman. There are four other people who, though not at executive level by role, have served continuously on the bank’s executive committee over the past two years – something implemented by the CEO. All these people are black – two men and two women. The bank introduced a Women Leadership Development Programme, at the initiation of the CEO and approval by the Board. Over the next three years, women 3 employees will have an opportunity to benefit from a mix of formal training at tertiary education institutions, supervisory and management development training, exposure and attachments at similar institutions and other related interventions. The sole objective of this programme is to develop women leaders in the business so that they are ready for leadership roles at different levels in the bank and in the broader economy. There is a committed budget behind this programme.

5) Of what results has the bank achieved by summoning farmers through the courts?
Instituting legal proceedings against clients is always a measure of last resort. This is only done after a significant time period has elapsed without any positive response from the client or when the client does not honour amended repayment terms or restructuring of the debt that take into account the farmer’s circumstances. Most clients who have reached legal action stage have either settled or significantly reduced their arrears, whilst making firm arrangements with the bank to settle the remaining arrears. Even at that late stage, the bank can and will accommodate clients to ensure that farm land is not unnecessarily forfeited to service their debt.
We have seen, and continue to see, very positive results from these initiatives in improving the bank’s non-performing loan book. Even with the improvement in collections, however, the amounts being collected at this stage are still not sufficient to meet the demand from clients. We could assist more people if the collections were higher but we see this as a journey that has yet to fully unfold. We will continue to focus on ensuring that we improve our collections processes so that we can fund more players across the agricultural value-chain. As we do so, we will continue to be accommodative to our clients who come forth to make the necessary repayment arrangements. We wish to re-iterate that it is not the bank’s primary objective to repossess farms. That is a last resort when all efforts have failed. This outlook informs our approach.

6) What is the mandate of the bank and what distinguishes the bank from other commercial banks in the country?
The mandate of the bank is to finance agriculture. We are a development financing institution and not a commercial bank. We are further differentiated from a commercial bank in that we are not a deposit taking institution, thus we don’t have the same sources of funding as a commercial bank has access to, to grow its loan book. The bank’s funding of its loan book is done through a combination of government funding, repayments from our clients and external debt. External debt however is expensive and is typically higher than our average lending rates to clients. Our interest rates are lower than market rates. Our grace periods tend to be better than those offered by commercial banks. Our payment frequency is more favourable than options offered by commercial banks. But just because we are a development financing institution does not mean clients do not have to honour their loan commitments. The bank is specifically not mandated to write-off debt on arrear clients and can only do so after all legal processes have been 4 thoroughly exhausted. We also provide repayment flexibility and are more accommodating than is the case with commercial banks. No commercial bank will wait for so long before they list a client on a credit bureau or resort to legal proceedings which might entail the selling of a client’s farm. Our mandate is also to be inclusive. We do this by providing loans to communal farmers who might not have fixed property to offer as collateral. In mid-2017, we introduced a no-collateral loan product for communal farmers which has to-date disbursed over N$55 million in loans. We also provide funding to farmers resettled on commercial farmland by the government without requiring collateral. We do this to catalyse the development of agriculture country-wide. In addition, the bank offers free training and mentorship services to farmers throughout the country, which commercial banks do not do. That’s our mandate.

7) The bank has hiked its interest rates twice since the appointment of the current CEO. What is the rationale behind this and are you aware of the impact its having on farmers loan repayments?
Interest rate adjustments need to be de-linked from the CEO. They are simply a business imperative. Needless to say that interest rate increases can only be implemented on approval of the Board following a thorough motivation from management supported by impact analysis. The last two rate adjustments were not the first time the bank has increased interest rates. This has happened in the past and will happen in future. To finance the needs of clients, the bank needs money. Because of the poor repayment record of the bank’s clients generally, inflows from existing clients are not sufficient to meet the demand. This means that the bank has to borrow to partly fund new loans. Such borrowing comes at a cost that is market related. The bank needs to gradually raise its interest rates to reflect that cost of funding. If the repayments were reasonable, none of this would likely be necessary. In the bank’s last audited financial report, the Auditor-General specifically advised the bank to adjust its interest rates to reflect its cost of funding. No institution can sustainably borrow at high interest rates to lend at low interest rates. That’s the rationale.

8) Does Agribank conduct any on-ground assessment at the request of farmers struggling to repay their loans when requested and how many have been conducted this year and last year?
It is not financially feasible for the bank to have its officials drive around the country visiting every farm. Assessments cannot be used as an excuse for clients not to make repayment arrangements. The farmer is in charge of his farming enterprise. What we certainly do is pre-approval inspections and where necessary post-disbursement inspections.

9)
The last time you spoke about a review process for the Affirmative loan scheme. Who is going to make up the panel and are farmers going to be represented?
The Ministry of Agriculture is the custodian of the Affirmative Action Loan Scheme (AALS), which was set up by Cabinet. The bank’s role is to advance loans to applicants in line with the requirements of the scheme. What we have consistently stated is that this scheme needs review – having been established in 1992. Much has changed since then. For one, farm prices have gone up substantially. The deposit requirement on this scheme, for example, has become unaffordable to many applicants. There are other elements of the scheme which the bank believes require review. We have proposed the need for review to the custodian of the scheme. So any questions about participation in the review of the scheme are best directed to the relevant Ministry.

10) What exactly is being reviewed and what are the problems?
In the bank’s assessment, it is the qualifying criteria that require review. There may be other perspectives which other stakeholders are free to bring to the attention of the Ministry of Agriculture.

11) The country is currently faced with a drought. What are the bank’s plans to help farmers?
The bank is closely monitoring developments in weather patterns and vegetation conditions and has been considering relevant options. These will be announced at the appropriate time in due course.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Agribank triumphs - Diamond Arrow at PMR Africa awards

Agribank scooped the prestigious Golden Arrow Award at the annual PMR Africa awards held in Windhoek on Monday. Awarded in the Leaders and Achievers – Agricultural Finance category, the award was given to Agribank for being one of the companies and institutions doing the most in their sectors over the past 12 months to stimulate the economic growth and development of Namibia. Agribank achieved a rating of excellent as determined by a random, national sample of respondents comprising chief executive officers, managing directors, business owners, company directors, managers and senior government officials based in Namibia.

Commenting on the award, Agribank CEO Sakaria Nghikembua expressed appreciation for the award noting that the Bank continues to make transformational in-roads in a very difficult operating environment. “As a Bank, we need to be resilient in the most testing of times, ensure financial sustainability and demonstrate exemplary corporate governance whilst making sure that we serve our mandate, that of being the catalyst for the transformation of the agricultural sector,” stated Nghikembua.

The vision, integrity, values and competence and empathy that contribute to ethical and sustainable business practices are measured meticulously. PMR Africa conducts a survey annually to measure companies, institutions, government entities and individuals on their contribution to the economic growth and development of the country, levels of management expertise, implementation of corporate governance and levels of innovation.

The PMR Africa awards are considered as the equivalent of the “Corporate Oscars” in Namibia. Corporate heavyweights rubbed shoulders at a business breakfast in Windhoek on Monday whilst waiting with bated breath as their ratings on various key performance indicators by fellow professionals were revealed. Through the awards, PMR Africa acknowledges contributions, initiatives, strategies, efforts and hard work of corporates in Namibia. The awards are aimed at, amongst others, enhancing excellence, setting a bench mark in the industry and acknowledging the contributions of businesses and employees.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

For enquiries, kindly contact the Marketing and Communication Division at:

Tel.: 061 2074332
Fax: 061 2074206

Vice President visits Agribank

Namibia’s vice president, Dr Nangolo Mbumba, visited Agribank last week as part of his familiarisation journey to key state-owned enterprises. Dr Mbumba met with the board and senior management before touring the Agribank building and meeting with staff members on the first and Midland branch floors.

During his welcoming remarks, board chairperson Michael Iyambo noted that the visit comes at a difficult time for the economy in general and agricultural industry in particular, especially given the prolonged economic downturn and unpredictable weather cycles. Iyambo was however optimistic that such conditions also present opportunities for the bank. “What we need as a nation is upright leadership, closer synergies among key stakeholders, innovation and diversification and most importantly the urge to take important decisions and actions” he concluded.

At the occasion, Agribank chief executive officer Sakaria Nghikembua presented an overview of the bank’s mandate, its product portfolio as well as challenges and opportunities the bank is facing, and how these are being dealt with. Nghikembua emphasised that Agribank has an important role to play in the land reform process in the country, adding the bank requires support of all stakeholders to effectively and sustainably deliver on its mandate.

On his part, Dr Mbumba expressed appreciation for the visible synergy and teamwork demonstrated by the bank’s board and senior management in the process leading up to his visit and during the visit itself. The vice president noted that farmland prices are skyrocketing and that a sustainable solution is required through a multi-stakeholder approach. He further called upon Agribank to finance value-adding industries, such as the abattoirs in communal areas in order to alleviate the urban migration challenge. He added that the dynamics of farming have changed and thus farmers need continuous training and mentorship to succeed. “You cannot live in a modern economy without sufficient preparation and requisite knowledge”, he concluded.

Issued by:

Sakaria Nghikembua
Chief Executive Officer
For enquiries, kindly contact the Marketing and Communication Division at:
Tel.: 061 2074332
Fax: 061 2074206

2018 Review

As the year draws to a close, we reflect on its highlights and anticipate the future. This has been a tough year – one that tested our resilience as a country. The Namibian economy stretched further into a technical economic depression that started in 2016. Since then the economy has registered nine consecutive quarters of negative growth, from 0.9 percent in the second quarter of 2016 to 0.2 percent in the second quarter of 2018. This is the first time that Namibia has experienced such a contraction episode since independence, largely driven by weak performance in the construction, manufacturing, wholesale and retail sectors. In our assessment, the current state of the economy is an outcome of a tight fiscal environment, underscored by sluggish household spending.

Primary agricultural output, which has historically supported the domestic economy, has surprised on the downside. The sector recorded growth of 1.4 percent and -1.1 percent in the first and second quarters of 2018, respectively, in contrast to the impressive growth of 16.5 percent and 21.2 percent recorded in the corresponding quarters of 2017. The minimal growth in the agricultural sector somewhat reflects that favourable prices and trading conditions observed in 2018 could not sustain agricultural output due to the dominance of supply side constrains over demand forces.

The surge in livestock producer prices in 2018 did not attract higher off-take rates as farmers largely focused on herd re-building, resulting in limited marketing stock being made available. Furthermore, the macroeconomic environment has been less supportive of the competitiveness of the agricultural sector.
Specifically, the Namibia Dollar plummeted against the US Dollar by about 7 percent (y-o-y), resulting in a production cost squeeze.

Looking to the future, Namibia’s real GDP growth is expected to marginally improve from a negative growth of 0.9 percent in 2017 to 0.6 percent and 1.9 percent in 2018 and 2019, respectively (BoN, July 2018). The mining and quarrying, electricity, water, transport and communication sectors are expected to support growth, complemented by a renewed focus on fiscal support to strategic sectors. Headline inflation is likely to average 4.3 percent this year, before increasing further to 5.7 percent and 5.4 percent in 2019 and 2020, respectively. Risks to the growth outlook are slow growth and political dynamics in our major trading partners, slow recovery of commodity prices, US policy uncertainty and sluggish domestic consumer spending.

Local meteorological experts predict that the 2018/19 rainy season will receive normal to below normal rainfall in most parts of the country. Given this forecast, we are concerned about the intensity and distribution of rainfall and the subsequent impact these twin developments might have on our customers.

The Namibian economy is faced with structural and climatic challenges. We need to embrace technology to increase production in the primary production and manufacturing sectors through backward and forward linkages. We believe that, policy-wise, these should be the key investment priority areas for the public and private sectors for the economy to rebound onto a sustainable growth path.

Agribank endured a tough economic environment, too. However, the Bank continued to support the agricultural sector through financial and advisory services. We see greater scope for Agribank to contribute to the economic development and betterment of the Namibian society. Towards that end, we strive to be the pillar that investors in the agricultural sector lean towards to grow their businesses.

In the midst of all this, we still see a promising agricultural sector provided it can embrace climate and economic-resilient strategies such as on-farm diversification, effective and on-time marketing and de-stocking, and the use of technology to enhance production. Aligning ourselves to the national strategic plans, the Bank will continue to support the agricultural sector through strategic interventions in the form of financial inclusion, sustainable lending practices, effective loan collections, stringent risk management and stakeholder partnerships.

Issued by:
Sakaria Nghikembua Chief Executive Officer

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

Agribank adjusts interest rates

Interest rates for some Agribank products will see a modest increase of 0.75 percent (75 basis points) effective 1 December 2018. The salary backed no collateral loan product will increase with 1 percent (100 basis points). Notwithstanding the increase in some products, the Government subsidised interest rates will remain unchanged at 4 percent, while penalty interest rate on arrear balances are unchanged at 2 percent. Overall, the Bank’s interest rates remain competitive relative to the market.

Subsidised loans are loans to communal farmers under the National Agricultural Credit Programme (NACP) and resettled farmers under the Post Settlement Support Fund (PSSF). The NACP was established in 1995 for communal farmers to access credit in order to increase food production and become surplus producers, create jobs and alleviate the cycle of poverty. It also serves as a preparatory stage for small scale farmers in communal areas before they could be considered to qualify for the purchase of commercial farmland under the Affirmative Action Loan Scheme (AALS).

The new interest rates per loan type are indicated in the table below:

Loan Type


Previous Rates


New Rates
Subsidised loans 4.00% 4.00%
Short term loans 8.00% 8.75%
Medium term loans 8.75% 9.50%
Long term loans 8.50% 9.25%
NACP non-production loans 7.50% 8.25%
NACP production loans 4.00% 4.00%
Post resettlement support 4.00% 4.00%
Bush control loans 6.50% 7.25%
No Collateral loans 8.00% 9.00%
Arrears penalty 2.00% 2.00%
Existing and prospective clients of Agribank are hereby informed of the change in interest rates.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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


Agribank gets new Board

In a seamless transition which represents change with continuity, Minister of Finance Calle Schlettwein recently appointed a new Board of Directors for Agribank. The new Board’s term runs from 1 September 2018 to 31 August 2021. The new Board is led by Michael Iyambo as Chairperson, with Dagmar Honsbein as Deputy Chairperson. Honsbein also chairs the Finance, Risk, Audit and Compliance Committee (FRACC). Other members of the five-member Board are Dr Michael Humavindu, who chairs the Credit and Investment Committee (CIC), Phanuel Kaapama who chairs the Human Resources Committee (HRC) and Peyavali Hangula. Hangula serves on the Finance, Risk, Audit and Compliance as well as the Human Resources Committees.

Two of the previous directors, namely former Board Chairperson Terttu Uuyuni and Oiva Mahina, who chaired the Human Resources Committee, retired from the Board and were not available for re-appointment after serving on the Board for eight and six years, respectively. Following is a brief profile of each of the new Agribank board members;

Michael Iyambo is a knowledgeable and successful commercial farmer, with a focus on horticulture. Iyambo’s successful farming business resulted in him receiving the following awards: Namibia Business Awards’ Award for Excellence (2011), Large Scale Horticulture Producer of the Year (2014), Freshmark Supplier of the Year (2016); and his appointment as the Chairman of the National Horticultural Task Team, Vice Chairman of the Karst Area Horticultural Association as well as Vice Chairman of the Potatoes and Onions Producers Association (Namibia). Iyambo was recently appointed as Chairperson of the Namibia Agronomic Board. His knowledge about the industry, and sound business acumen, provide for optimum advice on credit analysis. In addition to the Board chairmanship, Iyambo serves on the Credit and Investment Committee of the Board.




Dagmar Honsbein has fundamental and practical insights in value chain management as well as financial systems and resources mobilisation for development. She is equally comfortable in providing professional services at policy and grassroots levels. Her extensive knowledge in the productive sectors are invaluable as the Bank gears itself to serve its clients and respond to their needs in an ever-changing agricultural environment. Honsbein is a fellow in International Marketing from Reutlingen University in Germany and holds a Master’s degree in Chemical Engineering and Applied Sciences from Aston University, Birmingham, United Kingdom; as well as a Master in Leadership in Development Finance, from Frankfurt School of Finance and Management, Germany and a BSc in Wood Engineering from the University of Stellenbosch, South Africa. She is a Certified Expert in Microfinance, SME Finance and Climate and Renewable Energy Finance, as well as Financial and Managerial Accounting. In addition to chairing the Finance, Risk, Audit and Compliance Committee, Honsbein also serves on the Human Resources Committee. With her husband, she farms commercially in the Khomas region.

Dr Michael Humavindu boasts a strong academic and professional background in economic research and modelling, industrialization, MSME development and development banking. Dr Humavindu spent eight years in development finance at the Development Bank of Namibia (DBN), where he worked on project finance, deal structuring, credit assessments, and the design of policies such as the Microfinance Policy and Development Impact Framework. Presently a Deputy Permanent Secretary in the Ministry of Industrialization, Trade and SME Development, Dr Humavindu is optimally positioned to lead discussions and test the Bank’s policies against the fiscal space, sustainable finance and the country’s economic agenda. Dr Humavindu holds a PhD in Economics from the University of Umeä, an MSc in Finance and Investments from the University of Durham, United Kingdom, an MA in Economics from the University of Stellenbosch, and a Postgraduate Diploma in Environmental Economics from the University of London, United Kingdom. He chairs the Board’s Credit and Investment Committee and serves on the Finance, Risk, Audit and Compliance Committee.He is a Trainer of Trainers in Investment Appraisal as well as a Certified Development Banker. Dr Humavindu is an emerging communal farmer in the Otjozondjupa Region.

Peyavali Hangula is a Chartered Accountant in Namibia and South Africa, registered with the Institute of Chartered Accountants of Namibia (ICAN). She holds an Honours Bachelor of Accounting Science (CTA) from the University of South Africa (UNISA) and a Bachelor Degree in Accounting from the University of Namibia (UNAM). She completed her articles with Deloitte Namibia and thereafter was seconded to work for Deloitte in Atlanta, USA, for a period of 6 months to gain international experience in the field of auditing. Hangula’s work experience in the financial environment spans over a period of ten years. She possesses a wide range of skills in the areas of accounting, financial reporting, corporate governance, internal controls; external and internal audits a well as in regulatory reporting. Hangula has worked for Standard Bank of Namibia as a Financial Reporting Manager and as a Regulatory Manager. She now works for FirstRand Namibia as a Manager: Finance. Part of her community outreach involves serving as the National Treasurer and Chairperson of the Finance Committee of Scouts of Namibia. Hangula serves on the Finance, Risk, Audit and Compliance Committee, as well as the Human Resources Committee.

Phanuel Kaapama is employed at the University of Namibia (UNAM) as a Lecturer for Governance and Development Studies, where he is also serving as the current Head of the Department of Political and Administrative Studies. He holds a National Diploma in Public Administration from the Polytechnic of Namibia, as well as an MSc. in Development, Planning and Administration from the University of Bristol (UK). His research interest revolves generally around issues of development theory and practice. He regularly gives media commentaries on Namibian, African and world politics; and has published a number of academic papers. Prior to joining the academia in the year 2000, he worked for the National Planning Commission (NPC) as Namibia National Coordinator, Capacity Building for Economic Management Programme on secondment from United Nations Development Programme (UNDP) Windhoek. From 1997 - 1998 he worked for the Namibia Chamber of Commerce and Industry (NCCI) as the Head of the Policy and Advocacy Department. His first formal job was as the Founding Secretary General of the National Youth Council of Namibia from 1994 – 1997. Kaapama was part of the
High - Level Committee for the Preparation of the 2nd National Land Conference and is also a member of both the Technical Committee and Negotiating Team in the Bilateral Negotiation with the Federal Republic of Germany on 1904 Genocide, Apology and Reparation. He also boasts extensive farming experience in both communal and commercial agricultural sectors. Kaapama Chairs the Human Resources Committee and also serves on the Credit and Investment Committee.

Commenting on the new Board, Agribank chief executive officer, Sakaria Nghikembua, stated: ‘We are excited about the new Board. It’s a good story of change with continuity. This is a solid Board with experienced individuals who have established track records. It’s the type of people we should be having on Boards of public enterprises for progress. The appointing authority has done an excellent job here’.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

For enquiries, kindly contact the Marketing and Communication Division at:

Tel.: 061 2074332
Fax. 061 2074206

Agribank disburses N$360 million in new loans for 2018 financial year

Agribank advanced N$358 million worth of new loans in the financial year ended 31 March 2018, up 18% on N$304 million in the prior year. This was one of the many achievements highlighted by the bank’s chief executive officer, Sakaria Nghikembua, at the bank’s annual general meeting held on 26 September 2018. The bank also received a clean bill of health, receiving an unqualified audit from its external auditors for the year. This achievement followed intensive clean-up by the bank, after a qualified audit in the year ended 31 March 2017 because of legacy issues related to collateral securities records. Agribank is one of few public enterprises in Namibia which produce audited annual financial statements within six months of financial year-end.

At the occasion, Nghikembua informed stakeholders that the bank delivered on most of the promises made at the last annual general meeting, despite a difficult operating environment. He revealed that the bank grew its loan book by 6% year-on-year, from N$2.61 billion in 2017 to N$2.77 billion in 2018. Interest income on loan advances grew by a somewhat slower 4%, from N$167.5 million in 2017 to N$173.7 million in 2018. The slower growth in interest income, compared to the loan book growth, was as a result of the bulk of the disbursements for new loans occurring only in the last five months of the financial year. According to Nghikembua, the bank recorded a N$29.8 million overall surplus for the year. Whilst this remains a positive achievement, an increase in provisions for bad debts on loans advanced reduced the surplus level compared to the N$99 million achieved in the prior year. This is because the level of arrears remains relatively high.
The Agribank chief also noted that the bank had made good progress in slowing down the rate of increase in operational expenses over the past three years, moving from an annual increase of 17% in FY 2015/16 to 11.3% in FY 2016/17 and 7.5% in FY 2017/18.

According to Nghikembua, the biggest portion of the new loans went to farmland purchases, followed by large stock loans, consolidation of debt and seasonal production loans. The Khomas region received the highest allocation of loans at N$61 million, closely followed by Otjozondjupa (N$60 million), Hardap (N$40 million), Omaheke (N$39 million), with Oshikoto (N$31 million) completing the top five regions for collateral-backed loan disbursements. In contrast, the Zambezi region received the highest disbursements for the newly introduced no-collateral loan product at N$6.5 million, followed by Omaheke (N$3.9 million), Kavango (N$2.7 million), Oshana (N$2.6 million) and Ohangwena (N$2.4 million) respectively. In total, N$26 million worth of no-collateral loans were disbursed during the financial year. The bank has experienced more impressive growth in this loan product subsequent to financial year-end.

Statistics revealed at the AGM further show that the youth (up to age 40) received 27% of the total new loan funding from Agribank, while 36% of the funding went to people within the age group 41 – 60. The balance went to either clients above the age of 60 years or to registered legal entities.

“As a member of the Association of African Development and Finance Institutions, we rate ourselves in three core areas of governance guidelines, financial prudential standards and operational guidelines and I am pleased to announce that Agribank obtained an overall score of 78.4% in 2018, compared to 77.2% 2017”, Nghikembua stated, adding “this score is reviewed annually by our external auditor and has significantly improved from 64% in 2015/16 to current levels. The improvement means that the bank has been consistently enhancing its operational efficiencies, governance standards and financial management policies and practices”.


Nghikembua was also upbeat that the bank continues to make a consistent developmental impact in up-skilling and building capacity of farmers, noting that more than 5,000 farmers benefitted from the bank’s advisory services during the year through training, mentorship, lectures and farmers information days. “We need to assist more emerging farmers gain skills and knowledge to improve their productivity, increase production, employ more people and contribute to economic expansion”, Nghikembua enthused.

Meanwhile, he reiterated that the bank has to manage a tight liquidity situation because of the high level of arrears and declining treasury transfers, specifically over the past three years. The high cost of funding when raising capital in the market is another challenge that is likely to impact on the developmental mandate of the bank as its interest rates will require on-going upward reviews. Nghikembua however expressed confidence that these challenges can be addressed through a prudent mix of funding sources to keep Agribank lending rates affordable and sustainable in the long-term.

At the occasion, Dr Michael Humavindu, who chaired the AGM, stated that the bank has covered significant ground in creating a platform to make a meaningful contribution to the economy. “We are on course to play our part fully in the economy. As we do so, we remain grateful for the shareholder’s support and that of our other strategic stakeholders”, stated Dr Humavindu. He added that although the bank is facing liquidity constraints, it is implementing different strategies to alleviate liquidity pressure in the short-term and eliminate it in the long term. “We have continued our efforts to ensure financial sustainability. Collection efforts continue, despite all the odds, and we are on a trajectory to grow the loan book through new business”, he stated.

On his part, Finance Minister Calle Schlettwein, commended the bank for its efforts to diversify its loan book, noting that the bank plays an important role in the land reform process. According to the Minister, Agribank’s role is to service the agricultural sector in order to realise its optimal potential to create jobs, improve productive capacity and create wealth. Whilst commending the introduction of the agro-processing loan product, the Finance Minister also encouraged the bank to further develop financial products that will create value chains other than livestock and horticulture. Schlettwein further pledged his support to the bank, as it strives to fulfil its mandate in the land reform process in the country.

The Agribank AGM was attended by the shareholding Minister, Agribank board members and management as well as senior officials from the Ministries of Finance and Public Enterprises.

Issued by:

Sakaria Nghikembua
Chief Executive Officer

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

Agribank takes farms to auction

Two Agribank-financed farms will be auctioned on Friday, 27 July 2018. Both farms are in Otjozondjupa region and have already been advertised in local newspapers. The auctions follow hot on the heels of an announcement by the Bank that it had moved from a soft to a hard collections approach. Commented Sakaria Nghikembua, Agribank's chief executive officer "This is a last resort for us. There is no other option but to execute on the auction. The only thing that can stop the process now is payment of the arrears by the clients before the auction date. In the absence of that, the process will go through to the end".

Nghikembua added that these two auctions should not be seen in isolation but as part of an ongoing series. He emphasised that if clients persistently fail to honour their loan repayment commitments, the Bank will dutifully follow the same route. He added that the Bank had not only geared its internal structures to implement recovery strategies much faster than in the past but has also bolstered its collections efforts by recently adding new law firms to its legal collections panel.

Nghikembua once again appealed to clients to act before it is too late, saying "if a client waits until they are listed or until we have a judgement against them, it is too late. The best is to avoid these two situations by making repayment commitments and making every effort to honour such commitments".

Issued by:
Mr Sakaria Nghikembua
Chief Executive Officer

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

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Loans are granted against security of fixed property, investment or any other acceptable form of security (fixed deposits, investments and surrendering value of policies). read more

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