By Erastus Kalenga Hamunjela
On 15 April 2026, the Namibian government will process one of the most significant payout events in the local capital markets calendar.
Interest will be paid on the GI27 and GI33 inflation-linked bonds, while the GC26 fixed-rate bond will mature, returning both interest and full capital to investors. Three instruments, three different payment events, on the same day.
For holders of the GI27 and GI33, the April payout demonstrates how inflation-linked bonds function in practice. These instruments offer real returns of 4.0% and 4.5% respectively, but the return is applied to a principal that adjusts with inflation over time, rather than the original capital.
Namibia’s inflation slowed to 2.4% in February 2026, with full-year forecasts ranging between 3.4% and 3.8%. Even at these levels, the structure ensures investors are not only earning interest but also preserving the purchasing power of their capital.
The practical effect is significant. An investor holding N$100,000 in the GI33 could see their inflation-adjusted principal increase to approximately N$145,000 based on accumulated historical inflation.
The semi-annual coupon of 4.5%, which would ordinarily produce N$2,250 on the original principal, is instead applied to the higher adjusted base, resulting in a payout closer to N$3,262. This reflects the intended design of the instrument, delivering income that keeps pace with the cost of living.
There is also a tax advantage. Interest earned on Namibian government bonds is exempt from income tax for individual investors. As a result, an 8.5% return from a fixed-rate bond is more attractive in after-tax terms than a comparable bank deposit, where interest is subject to a 10% withholding tax.
The maturity of the GC26 introduces a separate dynamic. With a fixed coupon of 8.50%, the bond has been widely held by retail investors. On 15 April, holders will receive their final interest payment together with 100% of their original capital, creating a significant liquidity event in the market.
This release of funds will require reinvestment decisions. Investors seeking predictable income may turn to fixed-rate bonds such as the GC28, currently yielding between 8.3% and 8.5%. Others focused on inflation protection may consider longer-dated instruments such as the GI36.
One important technical point is that the Bank of Namibia closed the bond register on 15 March 2026. Investors who purchased these bonds after that date will not qualify for the April payout, as the bonds are now trading ex-coupon.
Beyond the mechanics, the 15 April payout marks an important milestone for many retail investors. For those who entered the market during recent bond issuances, this will be their first full cycle of receiving interest and, in the case of the GC26, the return of capital.
It is a reminder of how these instruments are designed to function, providing government-backed, tax-efficient and, in the case of inflation-linked bonds, inflation-protected returns.
Disclaimer: The information provided in this article is for educational and informational purposes only. It does not constitute financial, investment, legal, or professional advice. Readers should not rely on this content as the sole basis for making investment decisions and are encouraged to seek independent professional advice before acting on any information contained herein.
*Erastus Kalenga Hamunjela is a Namibian investment researcher and financial markets commentator with a strong focus on capital markets, investment literacy, and data driven financial education.
For Educational Investments, Business Consultation & Collaborations: erastuskalengier@gmail.com
