Private sector credit extension on the rise

WINDHOEK, 03 NOV– Namibia’s annual growth in broad money supply (M2) rose slightly at the end of September 2018, the Bank of Namibia’s (BoN) Money and Banking Statistics for August 2018 have revealed.
The 12-month growth in M2 rose to 8.2 per cent at the end of September, from a growth of 8.0 per cent in August.
M2 includes coins and notes that are in circulation and other money equivalents that can be converted easily to cash, in addition to short-term time deposits in banks and certain money market funds.
Broad money is the most inclusive method of calculating a given country’s money supply.
The BoN publication, released on Friday, also revealed that growth in private sector credit extension (PSCE) remained unchanged at the end of September.
The annual growth in PSCE stood at 6.6 per cent at the end of September, maintaining the same rate as in August.
On the other hand, the overall liquidity position increased during September.
The liquidity levels of the banking industry improved to N.dollars 4.8 billion during September, from N.dollars 4.4 billion at the end of August.
The report states that Namibia’s overall inflation rate increased during September to 4.8 per cent, higher than the 4.4 per cent recorded in the previous month.
Growth in private sector credit extension in total remained unchanged at the end of September.
The annual growth in total PSCE stood at 6.6 per cent at the end of September, maintaining the same rate as in the preceding month.
The steady growth in PSCE during the review period was mainly driven by an increased demand for credit by the business sector specifically in the categories mortgage loans, overdraft credit, other loans and advances.
According to the report, growth in total credit extended to businesses continued in an upward trend in September.
The annual growth in credit extended to businesses stood at 6 per cent at the end of September, compared to 5.2 per cent at the end of the preceding month.
The increased growth was driven by an increased demand for commercial property mortgages coupled with an increased demand for overdraft credit, and other loans and advances credit during the reviewed period.
(NAMPA)