Namibia’s private sector credit extension (PSCE) growth accelerated to 4.5% year-on-year in June, up from 4.3% in May, as stronger corporate borrowing offset subdued mortgage lending and supported overall credit expansion, according to IJG Securities.
The stock of total private sector credit increased by N$5.39 billion over the past 12 months to N$125.49 billion, while credit expanded by N$1.31 billion on a monthly basis.
IJG said total claims on the private sector have grown by an average of 4.5% so far this year, slightly below the 4.6% average recorded during the same period in 2025.
Corporate credit rose by N$903.4 million during June to N$53.19 billion, lifting annual growth to 4.5% from 4.4% in May.
“The improvement was primarily driven by increased demand for other loans and advances from corporates operating in the mining, wholesale and retail trade, financial services, and energy, oil and petroleum sectors,” IJG said.
The report noted that corporate other loans and advances rebounded after two consecutive months of annual contraction, increasing by 3.9% month-on-month to N$21.04 billion, with annual growth improving to 2.5% from a contraction of 2.4% in May.
Corporate overdraft balances increased by N$234.4 million during the month to N$10.46 billion, although annual growth slowed to 2.2% from 6.1% in May.
Meanwhile, corporate mortgage lending declined by N$209.1 million to N$13.03 billion, pushing annual growth back into negative territory at -1.1%, compared with 0.3% growth recorded in May.
“Instalment and leasing finance remained the strongest-performing corporate lending category, expanding 24.4% year-on-year to N$8.67 billion,” IJG said.
Household credit also strengthened during the month, increasing by N$408.8 million to N$72.30 billion, with annual growth accelerating to 4.5%, the fastest pace since August 2023.
“The improvement was underpinned by broad-based growth across most lending categories, with mortgage lending and instalment and leasing credit remaining the primary contributors,” the firm said.
Household mortgage lending increased by N$217.7 million to N$46.88 billion, with annual growth rising to 2.1%, the strongest level since January 2024.
IJG said household instalment and leasing credit remained robust, increasing to N$9.60 billion, with annual growth edging up to 14.8% from 14.6% in May, reflecting sustained demand for vehicle and asset finance.
Household other loans and advances grew modestly by 0.5% during the month to N$13.28 billion, although annual growth slowed to 4.9% from 5.3% in May.
While household overdraft balances declined by N$45.7 million during June, annual growth accelerated sharply to 12.5% from 5.8%, indicating continued reliance on short-term borrowing.
IJG said the improvement in overall credit growth points to a relatively resilient domestic economy, although lending activity remains weaker than in neighbouring South Africa.
“These trends suggest a relatively resilient domestic economy; however, credit growth remains subdued compared to South Africa, where PSCE growth remained in the high single digits at 7.8% year-on-year in June,” the firm said.
