Namibia's financial system resilient amid challenging conditions: report

WINDHOEK, April 27 (Xinhua) -- Namibia's financial system continued to be resilient amid recessionary economic conditions, according to a report released on Friday by the central bank, Bank of Namibia (BoN) and the Namibia Financial Institutions Supervisory.

The Financial Stability Report released on Friday identifies risks and vulnerabilities in the financial system and assesses the resilience of the financial system to domestic and external shocks.

According to the report, Namibia's banking industry remained well capitalized and maintained capital levels well above the minimum prudential requirements during 2017.

"The banking institutions displayed healthy aggregate balance sheet growth, positive profitability and satisfactory liquidity levels during the period under review. Given challenging economic conditions and the associated shedding of jobs, disposable income has come under pressure, resulting in a significant increase in the ratio of non-performing loans (NPLs)," the report highlighted.

The report said similarly, the non-bank financial institutions continued to be financially stable, sound, with growing assets, and with no major risks.

"The payment system and infrastructure also continued to perform efficiently and effectively, and with increasingly robust risk mitigating measures to facilitate safe payments," the report added.

Meanwhile the report stated that house prices decelerated, however, with no threat to the stability of the financial system.

The report noted that household debt moderated marginally, while corporate debt increased. Although both these ratios remained high when compared to those of peer countries, the associated risks to financial stability remain minimal, the report added. Enditem