{"id":27875,"date":"2021-05-03T10:10:15","date_gmt":"2021-05-03T08:10:15","guid":{"rendered":"https:\/\/ijg.net\/research\/?p=27875"},"modified":"2021-05-03T10:10:27","modified_gmt":"2021-05-03T08:10:27","slug":"psce-march-2021","status":"publish","type":"post","link":"https:\/\/ijg.net\/research\/psce-march-2021\/","title":{"rendered":"PSCE \u2013 March 2021"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

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

Private sector credit (PSCE) fell by N$337.6\nmillion or 0.3% m\/m in March, bringing the cumulative credit outstanding to\nN$105.3 billion. On a year-on-year basis, private sector credit grew by 1.55%\nin March, compared to the 1.76% y\/y growth recorded in February. On a rolling\n12-month basis, N$1.61 billion worth of credit was extended to the private\nsector. Of this cumulative issuance, individuals took up credit worth N$1.52\nbillion, while N$544.5 billion was issued to corporates. The non-resident\nprivate sector decreased its borrowings by N$455.5 million.<\/p>\n\n\n\n

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

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

Credit extended to individuals increased by 2.57%\ny\/y in March, on par with February\u2019s increase of 2.58% y\/y. On a monthly basis,\nhousehold credit grew by 0.4% following the increase of 0.6% m\/m recorded in February.\nMortgage demand by individuals remained relatively strong, increasing by 0.5%\nm\/m and 4.4% y\/y. Instalment credit remained depressed, increasing by only 0.2%\nm\/m, but contracting by 3.5% y\/y. Overdraft facilities extended to individuals\nhave increased by 0.9% m\/m and 1.5% y\/y.<\/p>\n\n\n\n

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

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

Credit extension to corporates contracted for a\nsecond consecutive month, declining by 1.1% m\/m, following the 0.6% m\/m contraction\nrecorded in February. On an annual basis, however, credit extension to\ncorporates recorded low growth of 1.3% y\/y in March, compared to the 1.6% y\/y\ngrowth registered in February. All segments contracted on a monthly basis. Mortgage\nloans to corporates contracted by 0.1% m\/m, other loans and advances (OLA) fell\n0.4% and overdrafts declined 3.0% m\/m. On a year-on-year basis, mortgage loans\ncontracted 3.6%, while OLA and overdrafts increased 0.6% and 13.0%\nrespectively. <\/p>\n\n\n\n

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

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

The overall liquidity position of commercial\nbanks improved during February, increasing by N$1.12 billion to reach an\naverage of N$2.60 billion. According to the BoN, liquidity spikes are generally\nobserved in March, as budget execution protocols are accelerated before the\nclose of the fiscal year. Additional inflows of funds were observed at the end\nof March as pension funds repatriated assets to comply with domestic asset\nrequirements, according to the BoN. The outstanding balance of repo\u2019s varied quite\na lot during the month, fluctuating between N$20.1 million and N$868.1 million,\nbefore falling to zero at month-end.<\/p>\n\n\n\n

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

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

As per the BoN\u2019s\nlatest money statistics release, broad money supply rose by N$11.1 billion or 9.5%\ny\/y in March. Foreign reserve balances rose by N$2.32 billion to N$34.7 billion\nin March. The BoN ascribed the increase to the net purchases of foreign\ncurrency by the central bank. <\/p>\n\n\n\n

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

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

Overall, PSCE growth\nremains subdued, decreasing by N$337.6 million in March, causing monthly growth\nto revert into negative territory for the first time since September 2020. The\nrolling 12-month private sector credit issuance is down 71.7% from the N$5.68\nbillion cumulative issuance as at the end of March 2020, with individuals\ntaking up most (94.5%) of the credit extended over the past 12 months.<\/p>\n\n\n\n

The low credit\nappetite reflects the lack of confidence in the Namibian economy, with\nbusinesses continuing to delever their balance sheets and banks being more\nprudent with lending out money. We expect interest rates to remain at their\ncurrent, historically low, levels. This should continue to provide overindebted\nconsumers and corporates with relief but is unlikely to drive PSCE growth. The\ndull PSCE statistics reflects the nation\u2019s poor recent economic performance of\nlate, as it reflects both lower consumption spending as well as lower\ninvestments by corporates, which are two vital components of GDP. There are\nvery few catalysts for economic growth at present, and as a result we do not\nexpect to see a recovery in credit extension in the short term. <\/p>\n","protected":false},"excerpt":{"rendered":"

Overall Private sector credit (PSCE) fell by N$337.6 million or 0.3% m\/m in March, bringing the cumulative credit outstanding to N$105.3 billion. On a year-on-year basis, private sector credit grew by 1.55% in March, compared to the 1.76% y\/y growth recorded in February. On a rolling 12-month basis, N$1.61 billion \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-27875","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\/27875","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=27875"}],"version-history":[{"count":1,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/27875\/revisions"}],"predecessor-version":[{"id":27882,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/27875\/revisions\/27882"}],"wp:attachment":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/media?parent=27875"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/categories?post=27875"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/tags?post=27875"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}