Namibia could be de-risked against erratic climatic conditions if it can sustainably tap underground water and create green zones as well as create a national climate resilience fund to smooth out the impact of climate volatility. This is the view expressed by Agribank Chief Executive Officer, Sakaria Nghikembua, at the recently concluded Economic Growth Summit in Windhoek.

Nghikembua explained that the country should exploit underground water resources to create green zones and turn traditional crop fields into all year round grain and horticulture sites. He asserts that through the extraction of water from aquifers in Ohangwena, Oshivelo and eastern Zambezi, in addition to tapping water from the Kunene river and redistributing it throughout the northern regions, could encourage diversification of crops and growing fodder.

Nghikembua also referred to the lack of adequate agricultural statistics for northern communal areas. "We need to establish a credible system of collecting agricultural statistics in northern communal areas and plan on the basis of solid information in respect of livestock numbers and crop yields", he stated. Nghikembua further highlighted the current fragmented coordination of the agricultural sector which leads to split efforts and ineffective impact. The Agribank chief intimated that through national coordination, mentorship and training of farmers should be strengthened to improve rangeland management, crop yields, incomes and deliver a positive contribution to the GDP. He therefore calls for establishment of the Chamber of Agriculture to coordinate improved synergies amongst various stakeholders, most notably the government, agricultural farmers’ unions, financial institutions and donors. He highlighted climate resilience through diversification at farm level as an emerging opportunity to ensure that farmers can maximise their income streams.

Nghikembua is of the view that policy options on value addition should focus on competitiveness and sustainability of primary producers. "We need to ensure access to knowledge and skills, access to productive infrastructure such as irrigation, access to expansive markets domestically, regionally and internationally and that policies aid profitability of value-adders", he noted. According to Nghikembua, the overall policy should include incentives to produce, add value and create jobs rather than to force specific behaviors on producers.

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 has approved loans worth over N$7.1 million for full time communal farmers under the Emerging Retail Financing Product (ERFP). The Bank introduced the ERFP in response to market demand for collateral-free products for full time communal farmers as part of its efforts to widen financial inclusion in addition to the No-collateral product for salaried employees.

The maximum loan amounts for ERFP is N$1 million at varying affordable and competitive interest rates depending on the merits of each business plan. Loans will be granted on the basis of the completion of the mandatory training and mentorship program in the production, management and marketing of the commodities of the undertaking. In addition, the applicants must be available for attachment to the Bank approved mentor.

The ERFP loans target full-time communal farmers already farming in areas such as animal husbandry for livestock farming, poultry farming for raising birds such as chickens, ducks, turkeys and geese, agronomy and horticulture for fruits, vegetables, nuts, seeds, sorghum, maize, pearl millet and mahangu as well as fodder production to supply feed to livestock. Applicants of the ERFP loans are required to submit a comprehensive business plan of which a template is available at all Agribank offices. The ERFP loans will be appraised against new criteria set after the comprehensive review of the product to ensure adequate risk mitigating measures are in place.

The Bank remains committed to implement innovative financing solutions to enhance agricultural production in line with the stated objectives of NDP5 and other national development goals.
Come one, come all to the nearest Agribank Regional Branches countrywide for the product that empowers full-time communal farmers at very competitive interest rates below the prime rate.

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

Agri Advisory Sevices (AASD) Upcoming Training Events

Agribank's delegation meets with Minister of Land Reform

Agri Advisory Services Division upcoming training events

1. WHAT IS THE DRIs? 
Drought relief interventions implemented by Agribank are aimed at assisting farmers to cope with the drought situation and mitigate the undesirable impacts of the drought on production performance and income, with the view to safeguard the performance of the Agriculture sector and the financial performance of the Bank.

2. WHAT ARE THE SPECIFIC DRI INTERVENTIONS?
(a) Installment relief and loan term extension of up to 2 years. This requires a client to make payment of 60% on installment due and 45% of the total arrears, if any. If the client does not have arrears, the he or she only needs to pay the 60% portion of the installment. If the client has arrears, the he or she needs to pay both the installment and arrears portions. The remaining installment and arrears balance is capitalized over the remaining loan period plus a loan term extension of up to 2 years.
(b) Drought relief loans with one year grace period. This facility is available for short-term, medium-term and long-term loans to help the client to meet immediate needs for fodder, water and adaptations needs such as wood and charcoal production to help generate on-going cash flows in these difficult times. Loans are given with a grace period of one year and they are subject to normal bank interest rates and credit requirements. Short-term loans are repayable over 3 years; medium-term loans over 5 years; whilst long-term loans are repayable over 8 years.
Note that the 1 year grace period in not included in the specified loan term periods; however, interests will be capitalized during the grace period. Details can be obtained at our offices.
Exclusions: Loans for purchase of tractors, farm vehicles, delivery vans, farm land and livestock purchase are excluded from the drought relief loans but will be treated under our normal product loans.

3. CONSIDERING A ONE–YEAR GRACE PERIOD UNDER THE DROUGHT RELIEF LOANS, CAN I ARRANGE TO START PAYING INTEREST DURING THE GRACE PERIOD? 
Clients can decide to start making payments towards interest during the grace period.

4. WHAT HAPPENS TO NORMAL AND PENALTY INTEREST ON MY LOAN ACCOUNTS IF I HAVE BEEN APPROVED FOR DROUGHT RELIEF ASSISTANCE? 
Normal interest will continue to accrue on clients’ loan accounts. If the client is successful with the arrears and installment relief, this means the balance of their arrears and installment will be capitalised. This then means the client will no longer be in arrears and penalty interest will therefore not apply. Whatever penalty interest is accrued up to the time that the relief is approved will be part of the amount that will be capitalised.

5. ARE THERE ANY COLLATERAL REQUIREMENTS AND WHAT ARE THE APPLICABLE INTEREST RATES 
For collateral-based loan products, collateral cover is a requirement for both drought schemes: (1) installment relief and (2) drought relief loans and the normal interest rates of the Bank will apply on the drought relief loans. This is so because the Bank does not have the option of raising cheaper money to lend for drought relief purposes.
Through the new loan contracts for both schemes, the client shall commit to revaluation of the collateral. Revaluation may or may not be necessary. It all depends on the current value of the client’s existing collateral with the Bank and how that compares to the new outstanding amount once relief has been provided to the client. Revaluation is to be done later after signature of the contract to reduce the turn-around time. For the purposes of approval of payment relief or the drought relief loans, a desktop valuation will be done by the bank. At the same time, clients are expected to sign the Power of Attorney for the registration of additional bond after revaluation of the collateral if this becomes necessary. Registration of an additional bond over the collateral will only become necessary if the new outstanding loan amount becomes higher than the collateral bond already held by the Bank for the particular client.

6. WILL THE LIVESTOCK INSPECTIONS STILL BE CARRIED OUT ESPECIALLY FOR CLIENTS THAT WOULD LIKE TO APPLY FOR DROUGHT RELIEF LOANS FOR THE DRILLING OR REHABILITATION OF BOREHOLES? 
For existing clients, livestock inspection will be exempted to speed up the loan cycle. However, clients will be expected to submit the latest herd statement. For new clients and in cases where farm inspection is deemed necessary by the bank, the normal inspection process will be maintained.

7. HOW DO I QUALIFY TO PARTICIPATE IN THE RELIEF SCHEME? 
Clients participate in the scheme through a partial payment of at least 45% on arrears and 60% of installment due at the time of application. Legal clients should apply for this scheme directly to the legal services division at the Bank’s Head Office. The contact details of the relevant people are part of this document and can also be obtained at any branch. If a client is unable to raise the minimum partial payment above, the Bank is prepared to enter into discussions to agree on an acceptable partial payment level with them. Where legal actions have been instituted against a client, the repayment arrangement should be made an Order of Court; such process should be handled by the legal services division. Subject to the down payment specified above and the Bank’s credit requirements, all clients are eligible for the drought relief loans.  Clients are required to commit to the revaluation of collateral and registration of additional bond when collateral shortfall is verified.

8. HOW WILL THE BANK TREAT THE FOLLOWING CATEGORIES OF CLIENTS
8.1. Post-Settlement Support Fund Clients o Installment relief: The same conditions that require clients to apply through a partial payment of at least 45% on arrears and 60% of installment due will apply. Collateral requirements for installment relief are not applicable and legal clients should apply for this scheme directly through the legal services division. Drought relief loans with one year grace period: if the client has not used up their entire N$200k allocation through this scheme, they can qualify for a loan on an unsecured basis up to the N$200k limit provided that such clients have made the partial payment of at least 45% on arrears and 60% of installment due. Where clients want to borrow more than the scope available in terms of this scheme, then they would have to provide collateral as such loans will then be made outside the post-settlement support scheme.
8.2. No-collateral salary-backed clients - Installment relief: This option is not available to these clients as they ought not to fall into arrears. In addition, the loan repayment is not dependent on farm income but on salaries. Drought relief loans with one year grace period: All No-collateral salary-backed clients can apply for the drought loans, subject to salary scope and repayment ability.
8.3. Clients with unsecured loans o Installment relief: clients qualify for the installment relief, subject to partial payment on installment due and arrear balances at the time of application.
o Drought relief loans with one year grace period: these clients qualify for the installment relief, subject to partial payment on installment due and arrear balances and full collateral cover.

9. WHAT IF THE REMAINING TERM OF MY LOAN ACCOUNT(S) IS OVERDUE OR IF I ONLY HAVE A SHORT REPAYMENT PERIOD LEFT? IN THAT EVENT, HOW LONG DO I HAVE TO PAY OFF MY RE-SCHEDULED ARREARS AND CAPITALIZED OUTSTANDING AMOUNT? 
All clients, regardless of the highlighted scenarios will get a maximum extension period of up to 2 years to pay off the re-scheduled arrears and capitalized outstanding amount.
If this arrangement turns out to be unaffordable to the client, it then demonstrates that the client does not qualify to benefit from the scheme or the client needs to pay in more than the required down-payment thresholds.

10. WHEN DO I START PAYING AGAIN MY NORMAL INSTALLMENTS IF GRANTED DROUGHT RELIEF LOAN? 
For the Installment Relief, clients will be expected to start paying again their normal installment 12 months from the date of signing the contract, irrespective of the repayment frequency.
For Drought Relief Loans, clients will be expected to start paying their installment after the expiry of the grace period. Then the repayment will happen based on the agreed repayment frequency based on the loan-type and the activity being financed.

11. WHERE DO I APPLY? 
New and existing clients are encouraged to lodge their applications for installment relief and drought relief loans at the nearest branch. The legal clients are expected to consult the legal division at the Agribank Head Office (ask for Mrs Evast Kalumbu and/or Mrs Ndinelao Hangula at 061 – 2074200) to apply for the installment relief facility. Thereafter, the client can contact the branch if he/she wishes to apply for the new drought relief loan.

12. HOW LONG DOES THE APPROVAL PROCESS TAKE? 
We expect the approval process will take up to 30 working days.

13. WHO DO I CONTACT FOR MORE INFORMATION ON THE AVAILABLE ASSISTANCE OR TO APPLY FOR RELIEF? 
Clients or interested farmers are encouraged to contact their nearest branch.

14. WHAT IS THE DUE DATE TO APPLY FOR THESE SCHEMES? 
The window period for Installment Relief is 30 September 2019, while for Drought Relief Loans is 31 March 2020.

Agribank offers relief to farmers as national drought emergency is declared

Agricultural lender, Agribank, has announced drought relief initiatives in an effort to offer relief and support to farmers countrywide.
The relief comes in two forms:
The first intervention is a payment relief on both arrears and instalments for the current year. The bank has announced that clients who are in arrears will be required to pay 45 per cent of their arrears after which the remaining arrears will be capitalised. An additional two years will then be added to the client's loan period in order to give them more time to repay the remaining amount. Capitalisation of the remaining arrears effectively means that the client will no longer be in arrears unless they fall into arrears again in the future. Once a client has settled the 45 per cent of the arrears, they will also be delisted from the credit bureau if they are currently listed by the bank. The bank has further announced that it recognizes that clients might not be able to pay the required 45 per cent in one go, so clients can pay off this amount in manageable amounts until 30 September 2019. Meanwhile, clients wishing to make use of this relief effort would be required to sign an agreement with the bank and the capitalisation of the remaining arrear and the credit bureau delisting will be effected once the agreed payment has been made.

Similarly, clients who anticipate that they will not be able to settle their annual instalments in full for the current year will be required to settle 60 per cent of the instalment due, with the remaining 40 per cent being capitalised. As with the arrears payment, an additional two years will be added to the client's loan period to make payment more affordable over time. Clients who may have difficulty meeting the payment requirements above are encouraged to make contact with their nearest branch to discuss possibilities. The bank is committed to ensuring that all clients who wish to take up the offer are assisted after consultations with the bank. Chief executive officer of Agribank, Sakaria Nghikembua, emphasised that no client should be turned away on the arrear and instalment payment relief option but that the client and the bank should engage where peculiar client circumstances exist. For this reason, the bank has set up a ‘war room’ at its head office where branches can immediately refer issues or queries they cannot resolve.

The second intervention is drought relief loans. The bank states that these loans will be offered to clients who have fulfilled the payment relief requirements and can be used for various drought related needs such as the purchasing of fodder, the drilling of boreholes or rehabilitation of boreholes or other water infrastructure, adaptive income streams such as wood and charcoal production and bush-to-feed-making equipment. Clients who qualify for the drought relief loans will receive a one-year grace period before they start with their repayment. The repayment periods for the loans after the grace period, as well as the interest rates charged, will be in line with the existing product terms of the bank.

States Sakaria Nghikembua, chief executive officer of Agribank, 'we are facing challenging times for both our clients and the bank. We want both to survive. We are trying to balance so many considerations to ensure our clients receive some scope to make it through this difficult period. We certainly wish we could do more but resources are limited. For the bank, our main source of funds is loan repayments by our clients. This means that total repayment relief is unfortunately not an option at this stage. But we believe we have done our best to assist our clients. We will maintain a flexible approach in our discussions with each client', adding 'given the urgency of the situation we have set up a war-room to deal with peculiar cases or queries which the branches might not be able to immediately deal with. This team will meet regularly to consider any such requests from the branches and provide feedback within 36 hours'.
The bank remains committed to making a difference in this situation and urges all clients to make use of the interventions being offered. The drought relief options commence on Monday, 13 May 2019. Clients are encouraged to contact their nearest branches for further details.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

In our latest engagement with farmers from the "previously disadvantaged background" community in response to Agribank‟s formal position against the calls (via the media) by farmers to have collection of loans suspended, allegations have been raised that Mr. Michael Iyambo has been receiving preferential treatment at their expense.

Such allegations as are follows:
1. That the chairperson has a loan with Agribank amounting to more than N$20 million which he is struggling to pay back.
As a matter of policy, the bank does not discuss individual loan account details with third parties including the media as such information is confidential between the Bank and the individual loan holder. However, in this instance, we can confirm that Mr Michael Iyambo, who is also the Chairperson of Agribank Board of Directors, is a client of the bank. From the status of his accounts, the bank cannot classify him as „struggling to pay back his loans‟. The amount being quoted as being the loan advanced to him is also exaggerated. As a matter of policy, the bank treats Mr Iyambo‟s account in exactly the same way as it treats all other accounts. This means that he is expected to repay his loans or, if necessary, make appropriate repayment arrangements which he must honour. We do not have exceptions to this requirement and it would indeed be good to prove factually otherwise.

2. That the chairperson transferred his corporate loan to Bank Windhoek and back to Agribank when he became the chairperson, which got restructured
The bank competes with commercial banks for agribusiness on a daily basis. Towards this end, we have many clients whom the bank takes over from these competitor banks. Before we take over any loan, a thorough credit assessment of the client and his or her business is conducted. First, the branch takes in the initial application and conducts the initial analysis. Then the credit division does its assessment as well. Only after the application has passed that stage would it proceed to the management credit committee, the board Credit Committee and, depending on the amount in line with the financial delegation of authority, the full Board. Mr Iyambo‟s application went through all those credit appraisal loops, and was approved by the Board in 2017.
Mr Iyambo became 2 chairperson of the Board only in September 2018. The entire assessment process was done with the full recusal of Mr Iyambo, as per the bank‟s governance requirements. We wish to point out that Mr Iyambo‟s application was submitted and approved by the previous Board, of which he was not chairman. It is thus false to assert that he moved his loan to the bank when he was chairperson. Mr Iyambo previously moved his loan to a commercial bank because of poor service from the bank. However, the bank challenged him as to why he serves on its Board whilst supporting a competitor. The bank challenged him to at least subject himself to credit assessment and see if he would be successful with his application. We do wish to highlight that employees of the bank, as well as directors, are free to apply for loans from it. When they do, they are subjected to the same requirements and rigour, including full recusal. And the bank has the same repayment expectations of such employees and Board members.

3. That the chairperson was given an additional loan on top of this by Agribank
As you might be aware, Agribank is financing the full value chain of agricultural products and it is very common for one client to have multiple loans with the bank. This is the same with many of our clients specifically because the bank finances different products. For example, a loan for equipment would be different from a production loan or a loan for farmland. The client would thus apply for different loans and all these would go through the same process. All of Mr Iyambo‟s applications were done at the time of move-over. It is disingenuous to want to suggest something extraordinary here.

4. That Agribank allowed him to shift his installments three times and that these loans were not even 100% secured
I am sure the "previously disadvantaged farmer‟ knows the contents of the bank‟s credit policy. Assuming that knowledge, we can confirm that Mr Iyambo‟s application was assessed and approved in full compliance with the bank‟s credit policy. All our clients have an opportunity to be pro-active and request for a shift in their installments to be more in line with their cash-flow generation. This is an option that is well-known by our clients and by our employees, especially those who serve clients in the branches and credit departments. It is thus not an option peculiar to Mr Iyambo. As far as we know, the bank has only approved one installment shift for Mr Iyambo. There are requirements that must be met before such a shift can occur, however, and such requirements had to apply in the case of Mr Iyambo. The bank is not aware of three installment shifts nor has it approved any. Any requests from Mr Iyambo would be dealt with in exactly the same manner as any other client‟s request. Mr Iyambo knows and appreciates this fact; so do all employees dealing with applications of this nature. The bank has gone on record numerous times advising our clients to come in individually and make repayment arrangements that suit their unique circumstances. That call still remains and we continue to be accommodative to our clients who come forth to make the necessary repayment arrangements.

5. That the chairperson is using his influential position to be able to enjoy this kind of leniency from Agribank
This allegation is blatantly false. The bank has relevant governance structures in place to ensure that at all times its interest is not compromised. Such interest supersedes any individual interest. The bank has very clear policies and procedures that guide its operations from loan origination, credit assessment, disbursements and even collections. It is therefore unfortunate that the "previously disadvantaged farmer" is twisting facts and using his imagination to cast aspersions over the image of the institution, as well as over the reputation of the individuals mandated to lead the bank, with the sole hope that some decision-maker would one day believe in his story and hopefully remove the bank‟s leadership that is simply trying under very difficult circumstances to run a well-governed and sustainable organisation that can continue to fulfill its developmental mandate over the long-term. Our resolve is to ensure that Agribank is managed efficiently in a self-sustaining manner so that it can have a much wider and bigger developmental impact in its space and for that we will not tire.

6. Anything else you would like to add?
It is unfortunate that the so called previously disadvantaged farmer goes to the extent of trying to create a false impression that something is amiss and that the bank is providing preferential treatment to a client. Nothing could be further from the truth. Mr Iyambo is simply one of the clients who are trying to respond to the bank's call to ensure their repayment arrangements are in order. It is therefore far-fetched to suggest that a client is treated leniently for being proactive and responsive to the bank's one-going advice. We once again urge our clients, and in particular the so called previously disadvantaged farmers, to invest the same energy, zeal and determination, which they invest in trying to find fault with the bank through false means, to make arrangements to repay their loans. What is required is for clients to respect their commitments and make the necessary repayment arrangements, especially in this challenging year.

Issued by:
Rino Muranda
Manager: Marketing and Communication

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

In line with its strategic focus on employees to develop leadership and management capacity to guarantee business continuity at all times, a group of 22 senior managers completed a six months’ leadership training course. This brings to 36 the number of middle and senior managers who participated in the course which covered aspects such as leading self, leading change, leading others, leading performance and leading engagement. The training aspects were complimented by actual work application in-between the theoretical modules to transform the Bank into a modern institution that is best placed to deliver superior customer service and effectively fulfill its mandate.

Speaking at the certification ceremony, Agribank Chief Executive Officer, Sakaria Nghikembua, noted that the value of any training is in the output of the beneficiaries. Nghikembua reminded the trainees to challenge themselves by asking themselves whether the services provided to clients are now better and efficient and whether the Bank is reaching out to more clients in an efficient manner. The Bank’s Organisational Development Manager Muhindua Kaura noted that "the training program had a tremendous impact on the business from the word go as it was a very practical process and demanded of participants to already apply their newly acquired knowledge and skills in the work environment".

Issued by:

Regan Mwazi
Executive: Marketing and Customer Strategy

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

A number of participants at the recently held public lecture on drought management strategies applauded Agribank for sharing valuable information on possible ways that livestock farmers can deal with the current adverse weather conditions. The lecture, held on Thursday 11 April 2019 in Otjiwarongo by Agribank’s Agri-Advisory Services Division (AASD), was attended by more than 60 part time and full time farmers, all with one common concern – the impact of the current drought on their livestock.

Namibia has endured recurrent drought conditions since 2013, which have affected the drier regions of the country such as the south, west and north-west, although some improvements in rainfall were recorded in 2017. Drought is characterized by a period of insufficient rainfall (far below average/normal) that depletes grazing areas and deprives the soil of sufficient/ moisture, resulting in poor land productivity. Consequently, drought conditions compromise livestock productivity, farm income, and farmers’ sustainable livelihoods.

During drought, livestock conditions deteriorate due to thirst and hunger, and eventual deaths are inevitable. Farmers do not earn much from their livestock as market prices have reduced due to deteriorated animal body conditions and insufficient fodder or grazing to maintain them. Financial burdens become heavier as farmers tend to depend heavily on commercial feed supplements to survive the drought.

AASD’s Technical Officer, Erastus Ngaruka, who conducted the public lecture, implored upon farmers to always have a plan to mitigate the impact of drought on their farming activities. "The most important stage is where farmers have to make decisions for any strategy chosen. Basically, they have three options; Relocate the animals, Sell the animals, or feed the animals, or a combination of these options", Ngaruka explained. According to Ngaruka, when a farmer decides on any or all three options, there are some key questions to be answered so that the decision is economical and not counter-productive in the end.

If the farmer decides to relocate, the following are key considerations: where to relocate and how far from essential services (e.g. markets, inputs), which animals and how many to be relocated, is there sufficient and reliable grazing and water? and what is the duration of your stay at the new place? It is advisable to assess the status of the new grazing area before moving the animals.

If the farmer decides to sell, the following needs to be considered. Which animals and how many to sell? when and where these animals will be sold, is there a restocking plan? how much money is expected from sales and what it is budgeted for. Timing is key when it comes to selling the animals, it is best to sell them while their body conditions and prices are favourable.

If the farmer decides to feed, the following needs to be considered. Which animals and how many needs to be fed? is there sufficient feed and additional money for extra feed? how much costs and for how long is the feeding period? what is your farm fodder flow plan and which are the sources? Drought feeding is most effective when animals are segregated according to their production stages and feeding needs.

Ngaruka reiterated that drought conditions will always vary, and there is no standard recipe to cope with drought. "Every year, a farmer should re-assess his/her farm business in terms of finances, feeds, and ability to survive any drought year," he concluded.

Issued by:
Regan Mwazi
Executive: Marketing and Customer Strategy

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