{"id":26907,"date":"2021-02-02T15:45:56","date_gmt":"2021-02-02T13:45:56","guid":{"rendered":"https:\/\/ijg.net\/research\/?p=26907"},"modified":"2021-02-02T15:45:57","modified_gmt":"2021-02-02T13:45:57","slug":"psce-december-2020","status":"publish","type":"post","link":"https:\/\/ijg.net\/research\/psce-december-2020\/","title":{"rendered":"PSCE \u2013 December 2020"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

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

Private sector credit (PSCE) increased by N$277.2 million or 0.3% m\/m in\nDecember, bringing the cumulative credit outstanding to N$105.4 billion. On a\nyear-on-year basis, private sector credit increased by 1.6% in December,\ncompared to 2.7% in November. On a rolling 12-month basis, N$1.64 billion worth\nof credit was extended to the private sector. Compared to the previous year,\nthe rolling 12-month issuance is down 75.5% from the N$6.71 billion issuance\nobserved by the end of December 2019. Of this cumulative issuance, individuals\ntook up N$2.60 billion, while corporates reduced their borrowings by N$546.0\nmillion and the non-resident private sector repaid N$414.7 million of their\nborrowings.<\/p>\n\n\n\n

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

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

Credit extended to individuals increased by 0.5% m\/m and 4.5% y\/y in\nDecember, growing at a slightly quicker pace than the 4.2% y\/y increase\nrecorded in November. The month-on-month growth mostly stemmed from instalment\ncredit which grew by 1.4% m\/m. Instalment credit, however, remains down on an\nannual basis, falling by 2.6% y\/y in December, although at a slower rate than\nin the prior 11 months. The value of mortgage loans extended to individuals\nrose by 0.5% m\/m and 5.2% y\/y. Overdrafts to individuals fell by 0.2% m\/m, but\nincreased by 8.6% m\/m, following the strong increase of 5.6% m\/m and 9.1% y\/y\nin November.<\/p>\n\n\n\n

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

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

Credit extended to corporates grew by 0.2% m\/m after increasing by 2.4%\nm\/m in November. On an annual basis, credit extended to corporates contracted\nby 1.2% y\/y. Overdrafts to corporates showed the strongest monthly increase,\nregistering growth of 1.0% m\/m and 12.6% y\/y. Demand for instalment credit by\ncorporates remained low, increasing by 0.3% m\/m, but contracting by 15.8% y\/y. Mortgage\nloans to corporates, which has been contracting on an annual basis since April\n2020, remained depressed, contracting by 0.1% m\/m and 8.7% y\/y in December.<\/p>\n\n\n\n

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

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

The overall liquidity position of\ncommercial banks deteriorated significantly during December, declining by N$1.09\nbillion to reach an average of N$1.25 billion. The Bank of Namibia ascribed the\ndecline to periodic corporate tax payments to the government during December. The\nrelatively low liquidity position has prompted commercial banks to utilize the\nBoN\u2019s repo facility, with the balance of repo\u2019s outstanding increasing from N$0\nat the start of December to N$1.04 billion at the end of the month.<\/p>\n\n\n\n

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

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

Broad money supply\nrose by N$12.2 billion or 7.4% y\/y in December, as per the BoN\u2019s latest\nmonetary statistics release. Foreign reserve balances rose by N$1.23 billion or\n4.0% m\/m to N$31.75 billion in December. According to the BoN, the increase is\ndue to net inflows of rand currency from commercial banks during the month.<\/p>\n\n\n\n

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

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

Overall, private\nsector credit growth remained depressed in 2020, slowing from the roughly 6%\ny\/y growth observed at the beginning of the year to the 1-2% range at the end\nof the year. The slowdown in growth was especially evident from May onwards, as\ncorporates started repaying their debt. What is also evident from the data is\nthat mortgage demand by individuals was relatively strong compared to corporate\ndemand for mortgages, with the average annual growth rate for individuals\nregistered at 5.4% compared to the average corporate growth rate of -4.9% in\nthis category. Corporate demand for instalment and leasing credit contracted\nsharply during the year, indicating that corporates are hanging on to their\nexisting fleet and machinery. This is to be expected in the current economic\nclimate where the is little reason for businesses to expand their current\noperations as no significant improvement in economic growth is expected.<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Overall Private sector credit (PSCE) increased by N$277.2 million or 0.3% m\/m in December, bringing the cumulative credit outstanding to N$105.4 billion. On a year-on-year basis, private sector credit increased by 1.6% in December, compared to 2.7% in November. On a rolling 12-month basis, N$1.64 billion worth of credit was \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-26907","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\/26907","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=26907"}],"version-history":[{"count":1,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/26907\/revisions"}],"predecessor-version":[{"id":26914,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/26907\/revisions\/26914"}],"wp:attachment":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/media?parent=26907"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/categories?post=26907"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/tags?post=26907"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}