Namibia’s Non-Bank Financial Institutions register marginal asset growth in Q3

January 21, 2022

Namibia’s Non-Bank Financial Institutions (NBFIs) registered a 2% growth in assets to N$354.2 billion, latest industry figures show.

The Namibia Financial Institutions Supervisory Authority (NAMFISA) revealed in its Q3 2021 report that the country’s short term insurance sector registered the biggest growth of 19.9% to N$7.6 billion as at 30 September 2021.

“An increase in the value of total investments of the industry contributed to the yearly growth in total assets. A recovery in the financial markets over the last quarters contributed to growth in the industry’s investments,” the report noted.

NAMFISA noted that sound growth in the value of investments and cash and cash equivalents mainly contributed to the increase of the total assets on both quarterly and yearly basis.

The increase in cash and cash equivalents resulted from insurers holding more cash at the end of the third quarter while appreciation in the value of the industry’s assets mainly resulted in gains observed in the South African and local equity and bond markets.

The country’s retirement fund’s total assets increased by 16.8% year-on-year to N$202.4 billion during the period under review, with the top 5 pension funds having held 83.3% of the industry’s total investment holdings, while the largest fund’s investment holdings represented 73.9% of the industry investment holdings.

“The growth in investment values is attributable to favorable financial market performances. during the quarter under review," read part of the report.

The Friendly Society’s industry assets increased by 11.1% year-on-year to N$2 million in the period under review.

“Contributions in respect of the only friendly society are normally received in-person by the society, and the easing of restrictions year-on[1]year resulted in outstanding balances being settled by many members of the Society. Similarly, investment income was observed to grow significantly year[1]on-year keeping with the developments in financial markets. Therefore, growth in the Friendly Societies Industry assets is attributable to higher contributions and financial market performances.”

Namibian investment managers’ assets under management increased by 9.9% on an annual basis to N$199.6 billion at the end of the third quarter of 2021.

“The increase in assets under management was mainly due to a combination of market recoveries and inflows as governments and central banks around the world-maintained stimulus measures.”

The assets of Long-Term Insurance industry’s (LTI) increased by 9.5% year-on-year to N$65.1 billion during the review period.

“A positive performance in the industry’s investments mainly contributed to the yearly growth in total assets.”

The total assets of the Collective Investment Schemes’ (CIS) assets under management increased marginally by 0.1% year-on-year to N$76.1 billion.

“The CIS continued to invest mostly in Namibia, with the local investments constituting 62% followed by CMA at 30.4% of the total assets invested.”

Assets administered by Linked Investment Service Provider (LISPs) for the quarter ending 30 September 2021 increased by 1.6% to N$14.4 billion, compared to the previous quarter.

“In terms of geographical allocations it’s indicative that Namibian domiciled assets constituted 60.5% of total assets. A total of 39.5% of assets under administration were invested outside Namibia. The value of the loan book increased by 11.6% to N$7.1 billion at the end of the period under review. This trajectory in the value of the stock was also reflected in that of the flows, particularly that of the disbursements and arrears.”

The Medical Aid Fund industry (MAF) however, recorded a 1.3% decline on an annual basis in total assets to N$2.1 billion as at 30 September 2021.

“The marginal decrease in total assets was a result of continued relatively high claims expenses (healthcare expenditure) during the quarter under review.”

NAMFISA regulated 650 entities during the third quarter of 2021.

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Last modified on Tuesday, 25 January 2022 16:55