The Development Bank of Namibia (DBN) reported a surge in its loan approvals to N$1.4 billion for the 2023-2024 fiscal year, compared to N$976.4 million recorded in the comparative period.
The increase signals DBN’s ever-expanding role in driving economic growth and development within Namibia.
According to DBN’s integrated annual report covering performance from 1 April 2022 to 31 March 2023, the rising trend arose from an increase in loan approvals to the public sector.
The annual report highlights that in the year under review, DBN allocated a significant N$700.5 million to the public sector, marking a substantial rise compared to the N$6.6 million approvals during the 2021-2022 period.
Furthermore, the report points out that DBN extended its support to the transport and logistics sector “with N$507.6 million in loan approvals, making up 34.7% of the total approvals”.
This was significantly higher compared to the N$5.0m that was approved in 2021/2022 for the sector.
The report highlights that the manufacturing sector also received substantial backing, with approvals totalling N$243.4 million, making up 16.6% of the total approvals.Â
However, the report acknowledges that there was a decline in the tourism and hospitality sector, “with only N$31.2 million, or 2.1% of the total approvals, compared to the N$67.6 million, or 6.9%, approved in 2021/2022”.
Despite the shift in lending priorities towards larger projects, as the report states “DBN remains committed to small and medium enterprises (SMEs)â€.
It notes that “N$102.9 million, or 7.03% of total loan approvals, were directed towards SMEs,” reflecting “a slight decline from the previous year’s N$115.7 million (11.85%)”.
In acknowledging the challenges faced, the report reveals, “DBN reported a net loss of N$269.8 million, mainly due to significant impairments on loans and advances”.
The report adds that “this loss, compared to a net loss of N$184.5 million the previous year, resulted from a vigorous effort to clean up the loan book in response to economic challenges, reducing DBN’s retained earnings from N$1.209 billion to N$939.2 million”.
This comes as the total assets of DBN now stand at N$7.79 billion, a reduction of 9% compared to the 2022 results of N$8.6 billion.
The company notes that it is now dedicating its resources to the preservation of the value that it has invested in the economic activity of its borrowers, as well as the broader economy.
