The Namibia Deposit Guarantee Authority’s (NDGA) market value amounted to N$16.2 million at the end of December 2022, a significant increase compared to N$10.3 million recorded in the prior year, an official has said.
NDGA’s head Florette Nakusera said the Authority recorded N$790,963 in interest earnings during the period under review while N$5.2 million was received in premiums.
She delivered the remarks at the NDGA launch of its 2023-2025 strategic plan, which provides the Authority with guided direction and sharp focus for the next three years.
“The report highlights that the market value of the Deposit Guarantee Fund increased significantly at the end of December 2022. The market value stood at N$16.2 million by the end of the reporting period, representing a significant increase from N$10.3 million the year before,” she said.
The full implementation of the Plan is expected to take the NDGA a step closer to realising its vision and accomplishing its mission.
“The release of our third annual report is a clear demonstration that the operational architecture and the governance structure that we have put in place is working,” NDGA’s Board Chairperson Ebson Uanguta said.
“The publishing of the annual report provides us with an opportunity to account to our stakeholders, particularly the Government, member institutions and the public at large. We rededicate ourselves to the full implementation of our strategic Plan and will commit the resources at our disposal towards this goal,” Uanguta added.
Meanwhile, Nakusera noted that the Deposit Guarantee Act, 2018 (No. 16 of 2018) established the NDGA with the primary goal of administering the Deposit Guarantee Scheme.
The Scheme aims to protect depositors from the loss of their deposits by compensating them in the unlikely event of a commercial bank’s failure. This ultimately enhances consumer protection while also improving financial stability.
“The Scheme adopts a guaranteed coverage limit of N$25,000 which is currently in effect. At this coverage limit, the Scheme covers more than 90% of current depositors. The Scheme therefore ensures that depositors have access to all or a portion of their funds in the event of a bank failure within a specified time period,” Nakusera said.
She added that it also protects against panic withdrawals by assuring depositors of the safety of their deposits even if a bank fails, reducing the likelihood and scale of such a failure culminating into a crisis for the entire financial system.
“All Namibian banking institutions and branches of foreign banks and building societies are required to be members of the Deposit Guarantee Scheme and pay annual premiums to the Scheme.”
Moreover, the banking industry remained resilient despite various challenges.
Nakusera noted that the industry reported good balance sheet growth, strong capital, profitability, and adequate liquidity levels.
“The steady economic recovery during the reporting year resulted in the industry recording elevated growth in earnings. The banking industry thus remained well capitalised, with a notable improvement in asset quality and total income during the review period,” Nakusera said.
