Review of localisation law finalised
The Bank of Namibia is set to submit the amended Micro Finance Banking Institutions Framework
to the Ministry of Finance, which will then be subsequently submitted to Parliament.
According to Ndangi Katoma, director of the department of strategic communication and financial sector development at the BoN, the Bank’s internal review process on the amendments to the Banking Institutions Act has been finalised.
“The industry consultations have also taken place in December 2011. The next step is for the industry stakeholders to sign off the proposed changes to the law and after that it will be submitted to the Ministry of Finance. The Ministry of Finance, in turn, will submit it to Parliament,” he said.
The drafting process of the new legislation for the regulatory framework was aimed at addressing issues such as the localisation of financial institutions.
Over the years, there has been a push for the localisation of ownership in financial institutions in Namibia.
Meanwhile, Katoma confirmed that the gazetting of the framework will no longer occur during the first quarter of 2012.
“Due to certain changes that became necessary in the process, the initial time line that was previously shared has changed. Other amendments will have to be captured in the principal legislation for banks and thereafter the Bank will make a submission to the Minister of Finance. It will then be scrutinised by the Cabinet Committee on Legislation, before submission to Parliament for approval,” he explained.
Katoma added that the bank expects that all the amendments will be submitted at once and the entire process should be finalised by the end 2012.
In an interview with he Economist in 2011, the Bank of Namibia indicated that there is one micro finance bank in the country’s system that is operating under the regulatory framework designed for commercial banks. Therefore, the Bank of Namibia aims to address this by creating the required differentiated regulatory framework under which micro finance banks operate, and by doing so to encourage more such institutions to do business in Namibia.