In 2015, Agribank announced that it will launch a no-collateral loan product for full-time communal farmers. In response to the announcement, many farmers submitted their applications. Following a period of refinement which resulted in delays, the bank is pleased to announce that approvals for ERFP loans have commenced, with over N$1.2 million worth of loans having already been approved. The bank currently has loans worth N$25 million on its applications shortlist. These loans are at various stages of credit appraisal. The bank introduced the ERFP in response to market demand for collateral-free products for full time communal farmers. The newly approved ERFP loans were re-appraised against criteria set after a comprehensive review to ensure that adequate risk mitigating measures were put in place for this product.

Agribank wishes to inform the public that priority is first being placed on previous applicants, whose applications are being re-appraised anew to determine viability. Once the bank has dealt with the existing shortlist, it will then invite new applications for this product. Says Sakaria Nghikembua, chief executive officer of Agribank: ‘we are quite excited that this product is back on track following comprehensive review. In the interim, we had introduced the salary-backed no-collateral loan product which is doing very well. The ERFP takes care of communal farmers who do not have full time employment and also have no tangible collateral to offer against their loans. This is yet a further way in which we continue to catalyse the transformation of agriculture in Namibia’.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Over past 18 months, Agribank has requested defaulting clients to make repayment arrangements to settle their arrears. Some clients have heeded this call and have continued to honour their arrangements. Others have made arrangements and failed to honour them. And yet others have made no arrangements and no payments, ostensibly on the mistaken understanding that, being a state-owned bank, Agribank will not repossess their farms. The Bank wants to place on record that it is not its objective to auction any farms except as a last resort.

However, the bank believes that it has allowed for sufficient time to sensitise its clients about the imperative for them to honour their repayment obligations. The bank further believes that it has sufficiently indulged its clients not only to make appropriate repayment arrangements but also to honour such arrangements.

Agribank wishes to inform its clients that it is intensifying its efforts to move from soft to hard collections. This means clients not honouring their commitments will be listed on credit bureaus more swiftly whilst those persistently failing to honour their commitments will have legal action taken against them. A number of files have already been handed over to lawyers for legal action in this regard. The process has also been tightened to ensure that the bank takes legal action against defaulting clients more swiftly than in the past.

Against this background, Agribank once again appeals to its clients to ensure that they pay their instalments when due to prevent arrears; and in the event where a client is already in arrears, to make and honour repayment arrangements to prevent legal action, default judgement and auctioning of their farms.

The sustainability of the bank depends on regular and adequate repayments by clients on loans advanced to them. In the absence of such commitment, the bank will not be able to fulfil its mandate to provide loan financing to existing and new customers to transform agriculture.

Issued by:
Mr Sakaria Nghikembua
Chief Executive Officer

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

Agribank has opened a new office in Gobabis in the Omaheke region this week. The office is situated in the Old Mutual Building in River Street and will serve clients in the entire Omaheke region.

Speaking at the official inauguration ceremony, Agribank chairperson Terttu Uuyuni stated that the Omaheke region plays an important role in contributing to the Bank’s loan book. “In the 2017/2018 financial year, Agribank recorded new business of over N$357 million of which the Omaheke region contributed N$40 million representing 11% of new business. This illustrates that Gobabis is a strategic growth centre for Agribank and we are confident that opening an office here will not only bring our services in town, but will create opportunities for Agribank’s growth”, Uuyuni enthused.

As part of its socio-economic transformation pillar of the strategic plan, Agribank provides training and mentorship services to farmers through the Agri-Advisory Services Division. During the 2017 – 2018 financial year, Agribank conducted 17 such interventions in 13 different locations in the Omaheke region, targeting both communal and commercial farmers. These interventions include farmers’ information days, evening lectures, short training courses, practical sessions and excursions which covered topics such as record keeping, animal health, as well as financial and grazing management. The Agribank chairperson was pleased “that 461 people benefitted from these interventions in the Omaheke region alone of which 329 were male, while 132 participants were female”.

At the same occasion, Finance Minister Calle Schlettwein, who officially inaugurated the Agribank Gobabis office, congratulated the Bank for expanding its footprint to strategic growth centres and bringing its services closer to their clients. The Finance minister also applauded the Bank for embarking upon the arrear collections strategy as part of its financial sustainability initiatives. “Gone are the days where treasury support to state owned enterprises went unchecked. In fact, going forward, Government will require commercial public entities to become self-sustainable although shareholder support can still be granted where necessary”, the Minister noted. Schlettwein further urged Agribank to continue to introduce new products that are responsive to the needs of the clients to accelerate the transformation of the agricultural sector.

Agribank loans can be utilized for purchasing farm land, production, livestock, farming infrastructure, vehicles and equipment, bush management, aquaculture, poultry, piggery, post settlement support as well as for value addition through agro-processing.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

In line with its strategic focus on employees, Agribank recently saw the first group of its middle managers complete a six months’ leadership training course. A total of 14 middle managers participated in the course which covered aspects such as leading self, leading change, leading others, leading performance and leading engagement. The theoretical training aspects were complimented by actual work application in-between the theoretical modules. The training is part of the Bank’s strategic people transformation agenda that is expected to result in a modern institution that is best placed to deliver superior customer service and effectively fulfil its mandate. Facilitated by the Organisational Development division of the Bank, the course was delivered in-house through the services of specialist training consultancy Capacity Trust.

Speaking at the certification ceremony, Agribank Chief Executive Officer, Sakaria Nghikembua, stated that “the Bank is committed to develop leadership and management capacity as well as create a pipeline of leadership competencies to guarantee business continuity at all times. This 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”.

According to Nghikembua, the bank has implemented a well-managed performance management system that is focused on creating a culture of performance and service delivery in the bank’s quest to serve as a catalyst for the transformation of the agricultural sector in Namibia. It is for this reason that the next phase of training would focus on leadership development for Senior and Executive Managers within the organisation.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Following a petition by a group of farmers who are in arrears with their loans, the governance structures of agricultural lender, Agribank, have reviewed the petition and have responded to the demands made by the ‘concerned’ farmers as per attached and signed response. Commenting on the bank’s response to the petitioners, Agribank chief executive officer, Sakaria Nghikembua, stated that “it is important to ensure that the bank is managed prudently for its sustainability. This is a cardinal principle from which we cannot detract. The only way this bank can be there for the future is by ensuring it is able to collect loans disbursed and do everything necessary to attain that outcome. We continue to invite clients in arrears to approach the bank for discussions related to their repayment arrangements. As far as practically possible, we would reach such agreements”.

See Attached and Signed Response

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Agribank has awarded full bursaries to three first-year students studying at the University of Namibia as part of its corporate social responsibility initiative. The bursaries cover tuition fees, academic books, accommodation, meals and academic expenses like examination fees.

Speaking at the award ceremony, Agribank chief executive officer, Sakaria Nghikembua, stated that Agribank’s vision is to serve as a catalyst in transforming the agricultural sector. “Transformation is effected by the Bank in many forms, primarily through agricultural loan financing, but also through capacity building – in this case funding tertiary studies”, Nghikembua noted.

According to him, “the ultimate aim is to produce graduates who can innovate and transform the agricultural sector, and to shape the perceptions of the upcoming generation to see agriculture as a critical pillar of the economy.” Nghikembua urged the beneficiaries, who are pursuing undergraduate studies in crop science, fisheries and aquatic science as well as veterinary medicine, to study hard and be good brand ambassadors of Agribank.

Whilst beneficiaries are not obliged to work for Agribank after graduation, they are expected to work in Namibia for a number of years equal to their bursary years.

At the occasion, Nghikembua further revealed that the Bank has spent over N$1 million on corporate social responsibility initiatives in the financial year ended 31 March 2018, which include supporting agricultural shows, agricultural related training activities, farmers’ information days, farmers’ unions and financial literacy, amongst others.

Issued by:
Sakaria Nghikembua
Chief Executive Officer

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

Interest rates for some Agribank products will see a modest increase of 0.50 percent (50 basis points) effective 1 December 2017. The Bank’s interest rates have not been adjusted since November 2013.

Notwithstanding the increase in some products, the Government subsidised interest rates will remain unchanged at 4%, while penalty interest rate on arrear balances will similarly also remained unchanged at 2%. Overall, 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. 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:

PLANTING SEASON TIPS FOR FARMERS
The season for planting has officially arrived and farmers should be busy preparing the land for cultivation and planting of grains like pearl millet (Mahangu), sorghum, maize and vegetables like, pumpkin, runner bean, water melon and tomatoes. Establishing a crop means that seeds or seedlings are placed in the ground at a certain time (referred to as planting time). If the crop establishes itself poorly, the yield potential is immediately limited.

Thus, a significant relationship exists between the time you plant and the crop yield you obtain. To ensure that the optimum yield is realised, crop producers need to take into consideration factors such as the correct time for planting, the plant spacing and the depth of seeding (sowing depth).
Planting time.

For most crops there is an optimum time for planting, which depends on the climatic conditions and the time taken by the crops to reach maturity. For summer crops, such as maize, pearl millet and cow pea, early planting at the beginning of the rainy season is desirable as yields decrease with late planting. If planting commences late, the crop is likely to not reach its full physiological stage due to fewer days remaining for it to reach maturity.

Plant spacing
The spacing of plants refers to the distance between rows and between plants in the row. The closer the spacing, the greater the number of crops that can be planted per hectare. However, too close spacing results in competition among crops and diseases and pests can spread quickly among the crop population. The ideal plant spacing depends on the type of crop, variety and the climatic conditions such as rainfall and water availability. Tomatoes may be grown at closer spacing of 5 cm apart, whereas crops like runner beans require 30 cm spacing in-between. In drier areas, wider spacing is preferable in order to provide more soil water to the individual crops. In high rainfall areas, or where there is irrigation, closer spacing is possible.

Sowing depth
The sowing depth of a crop depends on the size of the seed, the type of soil and the weather. Generally, smaller seeds are sown at a shallower depth than larger seeds, while the deeper the seed is planted, the longer it will take the seedling to emerge and the weaker the plant will be at emergence (which may reduce plant vigour and

yield). Seeds may be planted deeper into sandy soil or in the case of dry planting i.e. planting before the rainy season. An important point farmers should remember when planting is to ensure good seed-to-soil contact as this enables the necessary absorption of water by seeds, which initiates germination.

To achieve an optimum crop harvest, do not crowd seedlings or plant them too close to each other. Give the plants sufficient time and space to reach their full potential and avoid deeper seeding in heavy soils.
This article is compiled by Ms. Emilie Abraham, Technical Officer: Crops within Agribank’s Agri Advisory Services Division.

Issued by:
Marketing and Communication Division

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

Agribank delivers solid performance despite difficult operating environment
6 October 2017

Agricultural lender Agribank has reported solid financial performance for the year ended 31 March 2017, despite a difficult operating environment. The lender’s loan book has grown 7.4% year-on-year whilst interest income grew by 6.4% year-on-year. Although general administrative expenses went up by 11%, this is a slow-down from the 17% growth recorded for the year ended March 2016. If provisions in respect of post-retirement medical aid are excluded from the general expenses, then operating expenses only went up by 7% in the latest financial year. Another main contributor to the rise in general expenses is depreciation as a result of new vehicles and furniture acquired for the branches. Net profit increased from N$7.3 million in 2016 to N$138 million in 2017. This is as a result of both operating performance and a change in the method of provision on advances from a general provision based on outstanding loan balances to a specific method based on individual loan accounts. Individual account provisioning is in line with the Bank of Namibia’s guidelines for commercial banks (BID-2), which Agribank adopted for the 2017 financial statements.

In line with good corporate governance practices, the bank finalised its annual audit and held its annual general meeting within the prescribed six-month period after financial year-end. The annual general meeting, which took place in Windhoek on 21 September 2017, was attended by representatives of the Ministries of Finance, Land Reform and Public Enterprises.

Other achievements recorded during the 2016/17 financial year included the finalisation and implementation of the bank’s five-year strategic plan, the implementation of a bank-wide performance management system, the launch of the no-collateral loan product for communal farmers, the implementation of an arrears collection strategy, the establishment of an in-house Agri Advisory Services division to sharpen focus on training and mentoring services for farmers, and the launch of product-specific awareness campaigns.

For the current financial year the bank will implement a new loan book funding strategy whilst continuing to embed a high performance culture in the business. The bank is currently in the process of re-engineering critical business processes in order to improve customer service. Identified data integrity issues will also be addressed.

Owing to historical issues, the audit for the year was qualified as the auditor could not attain sufficient comfort regarding the accuracy and completeness of collateral securities data. In 2009, the bank migrated from BankMaster to SAP as the core banking system. At that time, SAP did not have a functionality to capture collateral securities. This functionality was developed between 2010 and 2012. In the intervening period, collateral securities information was captured in excel format with the uploading of the data from excel to SAP taking place in August 2012. Since then, the capturing of the collateral securities data was done directly onto the SAP system. For the past five years, the bank has been running a project to complete the capturing of the collateral securities data onto SAP. However, this information was found by the external auditor to be inaccurate and also incomplete resulting in the qualification. The bank has taken immediate steps to identify all capturing errors within the data and will ensure corrective action is taken to avoid a similar situation in future.
Issued by:

Sakaria Nghikembua
Chief Executive Officer

For enquiries, kindly contact Sakaria Nghikembua on: snghikembua@agribank.com.na or 0811280131.

END

Agribank has signed a one year Memorandum of Understanding (MoU) with the MAWF/GIZ Support to De-bushing Project.

The MoU covers the following areas for cooperation;

• Products development: collaborate in the development of financing products aimed at scaling-up projects in bush control and biomass utilisation.
• Loans risk assessment: utilise the valuable knowledge and information of the De-bushing Advisory Service (DAS) for risk assessment of bush control and bush-based value addition loans.
• Information sharing: DAS offers to provide referral service on Agribank’s loan products relevant to bush control and biomass utilisation, as part of their outreach services. Reciprocally, Agribank will be sharing information/data on loan products specifically on the uptake of related loans and especially those associated with the focal area of this MoU.
• Capacity building: DAS and Agribank to jointly coordinate capacity building activities for bush control loan holders. The parties will ensure that loan applicants undergo technical training in sustainable rangeland management, sustainable bush control and technologies used, biomass processing and utilisation, and the economics of bush control.
• Monitor and Evaluate: DAS and Agribank to collaborate in monitoring and evaluating the implementation of bush control and biomass utilisation activities by loan holders, and assess short and long term economic and environmental impact, and the loan repayment ability...

1. Creating value addition opportunities for the biomass resource
2. Supporting farmers, wood harvesting and processing industries through the establishment of a De-bushing Advisory Service (DAS).
3. Creating an enabling environment in general to establish an environmental friendly and sustainable biomass industry.