{"id":22532,"date":"2019-10-31T14:31:12","date_gmt":"2019-10-31T12:31:12","guid":{"rendered":"https:\/\/ijg.net\/research\/?p=22532"},"modified":"2019-10-31T14:31:13","modified_gmt":"2019-10-31T12:31:13","slug":"psce-september-2019","status":"publish","type":"post","link":"https:\/\/ijg.net\/research\/psce-september-2019\/","title":{"rendered":"PSCE \u2013 September 2019"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

Overall<\/strong><\/p>\n\n\n\n

Private\nsector credit (PSCE) increased by N$644.5 million or 0.64% m\/m in September,\nbringing the cumulative credit outstanding to N$101.4 billion. PSCE grew at a\nmarginally faster rate of 6.2% y\/y in September compared to 6.1% y\/y in August.\nOn a rolling 12-month basis N$5.95 billion worth of credit was extended to the\nprivate sector, down 10.2% y\/y. Individuals took up N$3.80 billion while N$2.36\nbillion was extended to corporates, and the non-resident private sector\ndecreased their borrowings by N$201.9 million.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Credit Extension to Individuals<\/strong><\/p>\n\n\n\n

Credit\nextended to individuals increased by 6.8% y\/y in September, almost unchanged\nfrom the 6.7% y\/y growth recorded in August. Mortgage loans extended to\nindividuals increased by 0.4% m\/m and 6.7% y\/y. Installment credit continued to\ncontract, by 0.7% m\/m and 6.0% y\/y. Other loans and advances (which is made up\nof credit card debt, personal and term loans) grew by 2.3% m\/m and 23.1% y\/y in\nSeptember. Household demand for overdraft facilities remained relatively strong\nin September, increasing by 1.8% m\/m and 11.0% y\/y. <\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Credit Extension to Corporates<\/strong><\/p>\n\n\n\n

Credit\nextension to corporates grew by 1.0% m\/m and 6.2% y\/y. On a rolling 12-month\nbasis N$2.36 billion was extended to corporates as at the end of September, an\nincrease of 44.1% y\/y. Although the uptick in the general demand for credit by\ncorporates over the last year seems positive, the biggest driver of the increase\nin credit extended to corporates was shorter-term debt. Overdraft facilities\nextended to corporates grew by 2.4% m\/m and 5.1% y\/y, while other loans and\nadvances to corporates increased by 1.1% m\/m and 16.0% y\/y. The increase in\nthese categories indicates that businesses are still relying on overdrafts and\ncredit card debt to keep the lights on. Mortgage loans by corporates increased\nby 1.0% m\/m and 4.9% y\/y, while installment credit increased by 1.4% m\/m, but contracted\nby 6.2% y\/y.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Banking Sector Liquidity <\/strong><\/p>\n\n\n\n

The overall\nliquidity position of commercial banks declined by N$670.0 million in September\nto reach an average of N$2.99 billion. The Bank of Namibia attributed the\ndecline in liquidity to lower domestic Government spending mainly due to lower\neconomic activity coupled with higher foreign currency outflows as a result of\nimport payments during the review period. <\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Reserves\nand Money Supply<\/strong><\/p>\n\n\n\n

As per the BoN\u2019s latest money statistics release, broad\nmoney supply rose by N$1.34 billion or 8.4% y\/y in September, following an 8.0%\ny\/y increase in August. Foreign reserve balances fell by N$1.16 billion to N$32.3\nbillion in September from N$33.4 billion in August. According to the BoN, the\ndecrease was mostly due to an increase in net foreign capital outflows during\nthe period under review.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Outlook<\/strong><\/p>\n\n\n\n

Private sector credit\nextension continues to languish, increasing by 6.2% y\/y during September. It\nhas been 35 months since PSCE last recorded double digit growth. As expected, the\n25-basis point rate cut in August has not resulted in higher demand for credit,\nas consumers are already overindebted and growth opportunities for businesses are\nfew due to a lack of demand. As mentioned earlier, corporates continue to rely\non short-term debt to keep the lights on instead of taking on longer-term\ncredit to invest in capital projects to expand operations. We do not expect\nconditions to improve in the short- to medium-term.<\/p>\n","protected":false},"excerpt":{"rendered":"

Overall Private sector credit (PSCE) increased by N$644.5 million or 0.64% m\/m in September, bringing the cumulative credit outstanding to N$101.4 billion. PSCE grew at a marginally faster rate of 6.2% y\/y in September compared to 6.1% y\/y in August. On a rolling 12-month basis N$5.95 billion worth of credit \u2026 Continue reading → <\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6,22],"tags":[],"class_list":["post-22532","post","type-post","status-publish","format-standard","hentry","category-economicresearch","category-psce"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/22532","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/comments?post=22532"}],"version-history":[{"count":1,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/22532\/revisions"}],"predecessor-version":[{"id":22540,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/22532\/revisions\/22540"}],"wp:attachment":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/media?parent=22532"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/categories?post=22532"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/tags?post=22532"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}