The Bank of Namibia will raise N$2 billion through a domestic bond auction on Wednesday, 27 August 2025, comprising N$1.5 billion in nominal fixed-rate bonds and N$500 million in inflation-linked instruments.
The auction is part of a new N$2 billion domestic borrowing plan introduced after delays in external funding, and comes as the government prepares to redeem its US$750 million Eurobond when it matures on 29 October 2025.
Simonis Storm Securities Junior Equity Analyst, Kara van den Heever said the issuance follows an announcement that an additional N$2 billion would be sourced locally due to delays in external funding.
“Currently, overall banking industry liquidity stands at N$7.4 billion, with the Namibian position at N$1.67 billion,” van den Heever said.
She noted that the previous government bond auction had attracted strong demand, with bids totalling nearly N$1.7 billion compared to an initial offer of N$487 million.
“In the IRS segment, a total of N$1.38 billion was tendered against an allocation of N$407 million,” van den Heever said.
According to van den Heever, interest was strongest in the middle of the curve.
“The GC35 bond received N$240 million in bids, of which only N$40 million was allocated. The GC28 bond saw its highest accepted yield fall by 51 basis points to 8.29%, while GC32 declined by 47 basis points to 9.38%. Longer-dated bonds such as GC48 and GC50 also registered yield compressions of 44 basis points,” she said.
She added that inflation-linked bonds recorded healthy participation.
“Inflation-linked bonds continued to attract interest, particularly in the medium to long-term maturities. The newly issued GI41 emerged as the most sought-after instrument, achieving a bid-to-cover ratio of six times, while GI36 followed closely at 4.64 times,” she said.
Namibia remains on track to redeem its US$750 million Eurobond in October, with the government’s sinking fund now standing at more than US$500 million, well above the halfway mark required for repayment accxording to Bank of Namibia.
