{"id":27179,"date":"2021-03-01T16:52:53","date_gmt":"2021-03-01T14:52:53","guid":{"rendered":"https:\/\/ijg.net\/research\/?p=27179"},"modified":"2021-03-01T16:52:55","modified_gmt":"2021-03-01T14:52:55","slug":"psce-january-2021","status":"publish","type":"post","link":"https:\/\/ijg.net\/research\/psce-january-2021\/","title":{"rendered":"PSCE \u2013 January 2021"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

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

Private sector credit (PSCE) increased by N$224.1 million or 0.2% m\/m in\nJanuary, bringing the cumulative credit outstanding to N$105.6 billion. On a\nyear-on-year basis, private sector credit grew by 1.50% y\/y in January, on par\nwith December\u2019s increase of 1.58% y\/y. Cumulative credit extended to the\nprivate sector over the last 12-months amounted to N$1.56 billion. Of this\ncumulative issuance, individuals took up N$1.4 billion worth of debt while\nN$428.8 million was extended to businesses. The non-resident private sector\ndecreased its borrowings by N$312.9 million.<\/p>\n\n\n\n

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

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

Credit extended to individuals fell by 0.7% m\/m, but rose 2.5% y\/y in\nJanuary, growing at almost half the pace than the 4.5% y\/y increase recorded in\nDecember. All categories recorded a contraction on a monthly basis. Individuals\npaid back overdrafts during the month, resulting in a 1.7% m\/m decrease in this\ncategory, but rose 2.3% y\/y. Instalment credit declined by 1.3% m\/m, while\nmortgage loans extended to individuals contracted by 0.5% m\/m.<\/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 1.0% y\/y in January, after\ncontracting by 1.2% y\/y in December. On a month-on-month basis, credit\nextension to corporates rose 1.3% in January. The month-on-month growth in\ncorporate credit was primarily driven by increased uptake in overdraft\nfacilities which registered growth of 3.7% m\/m and 14.2% y\/y. The Bank of\nNamibia indicated that this was mostly due to increased demand for short-term\ncredit facilities to finance their working capital requirements during the\nmonth. Demand for instalment credit by corporates remained low, increasing by\n1.5% m\/m, but contracting 12.8% y\/y. Mortgage loans to corporates, grew by 2.7%\nm\/m, but contracted by 3.2% y\/y, the lowest annual contraction rate in nine\nmonths. <\/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 further during January, declining by N$474.3\nmillion to reach an average of N$775.1 million. According to the Bank of\nNamibia, the decline is due to periodic corporate tax payments to the\ngovernment. Commercial banks continued to utilize the BoN\u2019s repo facility in\nJanuary, with the balance of repo\u2019s outstanding falling from N$1.04 billion at\nthe start of January to N$845.7 million 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$11.7 billion or 10.2% y\/y in January, as per the BoN\u2019s latest\nmonetary statistics release. Foreign reserve balances increased notably in\nJanuary, up 8.3% m\/m or N$2.63 billion to a total of N$34.4 billion. The BoN\nascribed the increase to SACU receipts during the month.<\/p>\n\n\n\n

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

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

Overall, PSCE\ngrowth remains extremely subdued and was very much in line with the growth seen\nin December on a year-on-year basis, increasing by 1.5%. Rolling 12-month\nissuance is down 77.0% y\/y to N$1.56 billion as at the end of January, with\nindividuals taking up most (92.6%) of the credit extended over the past 12\nmonths. <\/p>\n\n\n\n

We expect the\nBank of Namibia\u2019s MPC to keep interest rates at its current level for the most\npart of the year, with the South African FRA curve pricing in the possibility\nof a 25 bp hike towards the end of the year. Although inflation and other\nmarket conditions will likely inform the MPC\u2019s decision. Further rate cuts are\nlikely to have very little, if any, impact on PSCE growth, as rates are already\nat historically low levels. Significant PSCE growth is likely to only return\nonce economic conditions improve meaningfully.<\/p>\n","protected":false},"excerpt":{"rendered":"

Overall Private sector credit (PSCE) increased by N$224.1 million or 0.2% m\/m in January, bringing the cumulative credit outstanding to N$105.6 billion. On a year-on-year basis, private sector credit grew by 1.50% y\/y in January, on par with December\u2019s increase of 1.58% y\/y. Cumulative credit extended to the private sector \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-27179","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\/27179","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=27179"}],"version-history":[{"count":1,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/27179\/revisions"}],"predecessor-version":[{"id":27186,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/27179\/revisions\/27186"}],"wp:attachment":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/media?parent=27179"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/categories?post=27179"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/tags?post=27179"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}