Namibia launches deposit guarantee authority to protect depositors
The Namibia Deposit Guarantee Authority (NDGA) was officially launched with the aim of providing protection to depositors against the loss of their deposits, by providing compensation in the unlikely event of a commercial bank failure.
The Namibia Deposit Guarantee Authority, housed in the building of the Bank of Namibia, has been operational since 1 February 2020, with the main objective to administer the Deposit Guarantee Scheme.
According to the authority head, Emma Haihambo, all banking institutions registered in Namibian as well as branches of foreign banks and building societies are required to be members of the Deposit Guarantee Scheme and are required to pay annual premiums to the Scheme.
“The Scheme has a guarantee coverage limit, currently set at N$25,000. At this current limit, the Scheme covers over 90% of current depositors,” she added.
Haihambo said major local banks including FNB, Bank Windhoek, Standard Bank, Nedbank, Letshego, Trustco Bank, BankBic and Banco Atlântico are members.
On the same day of the official launch, the NDGA also launched its first annual report, which received clean audit from independent auditors, Grand Namibia.
The Deposit Guarantee Fund’s market value stood at N$4.902 million by the end of the fourth quarter of 2020, which is N$35.363 thousand higher than the N$4.867 million at its inception date of 18 October 2020. This growth in value represents a portfolio total return of 0.727% for the quarter. The total equity and liabilities of the NDGA stood at N$5,258,337 in 2020.
Haihambo meanwhile said, the need to establish a Namibian Deposit Guarantee Scheme emanated from the Namibia Financial Sector Strategy. The Strategy was adopted in 2012 with the aim of transforming the financial sector into a more competitive, resilient and inclusive sector that would enable the economy to attain its highest potential.
The Bank of Namibia provides facilities, resources, and other services to the NDGA, and that the two entities enter into a service-level agreement. As a result, the Bank of Namibia has seconded three of its staff members to manage and operationalize the NDGA on a part-time basis.
Although it resorts under the Bank of Namibia for day-to-day administrative functions, the policy formulation function and oversight of the Authority resort under an independent Board of Directors appointed by the Bank of Namibia with the approval of the Minister of Finance.
Currently, Bank of Namibia Deputy Governor, Ebson Uanguta is the Chairperson of NDGA Board of Directors while Emma Haiyambo is the Head of the NDGA.
Board and Staff members, f.l.t.r: Petrus Shifotoka Principal Economist, (Staff Member); Mr. Festus Nghifenwa, Non-Executive Director and Member of the Audit, Risk & Investment Committee (Board Member); Ms Linda Dumba Chicalu Deputy Baord Chairperson and Non-Executive Director Member of the Audit, Risk & Investment Committee (Board Member); Mr. Ebson Uanguta, Board Chairperson; Dr Emma Haiyambo, Head of the Authority (Staff Member); Mr. Kenneth S. Matomola, Non-Executive Director (Board Member); and Mr Emile Van Zyl, Technical Advisor (Staff Member).
