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Private sector credit increases by N$4.22 billion in January

Private sector credit increases by N$4.22 billion in January

Private sector credit increased by N$4.22 billion or 4% in January, the largest month-on-month percentage increased since 2003, bringing the cumulative credit outstanding to N$110.6 billion, according to the Bank of Namibia.

On a year-on-year basis, private sector credit grew by 4.8% in January, substantially quicker than the 1% growth recorded in December.

Cumulative credit extended to the private sector over the last 12 months amounted to N$5.04 billion. N$1.9 billion worth of credit has been extended to individuals on a 12-month cumulative basis, while N$917.9 million was extended to corporates. Claims on non-resident private sectors increased by an immense N$2.4 billion during the month, which drove most of the increase in the overall private sector credit figure.

IJG economists said while the private sector started off the year with a strong 4%, it should be noted that a significant portion of the increase has been driven by an increased uptake of overdraft facilities, particularly by corporates.

“Overdraft facilities are typically used to address short-term funding requirements, and not to fund long-term capital investment projects. The N$2.4 billion increase in claims on non-resident private sectors is however encouraging,” IJG noted.


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Donald Matthys

Donald Matthys has been part of the media fraternity since 2015. He has been working at the Namibia Economist for the past three years mainly covering business, tourism and agriculture. Donald occasionally refers to himself as a theatre maker and has staged two theatre plays so far. Follow him on twitter at @zuleitmatthys