{"id":28551,"date":"2021-07-06T10:12:10","date_gmt":"2021-07-06T08:12:10","guid":{"rendered":"https:\/\/ijg.net\/research\/?p=28551"},"modified":"2021-07-06T10:12:13","modified_gmt":"2021-07-06T08:12:13","slug":"psce-may-2021","status":"publish","type":"post","link":"https:\/\/ijg.net\/research\/psce-may-2021\/","title":{"rendered":"PSCE \u2013 May 2021"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

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

Private sector credit (PSCE) fell by N$214.2\nmillion or 0.20% m\/m in May, bringing the cumulative credit outstanding to\nN$105.0 billion. On a year-on-year basis, private sector credit grew by 2.66%\nin May, compared to the 2.74% y\/y growth recorded in April. On a rolling\n12-month basis, N$2.72 billion worth of credit was extended to the private\nsector. N$2.34 billion worth of credit has been extended to individuals on a\n12-month cumulative basis, while N$498.1 million was issued to corporates. The\nnon-resident private sector decreased their borrowings by N$112.2 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 3.98%\ny\/y in May, compared to the increase of 3.91% y\/y recorded in April. On a\nmonthly basis, household credit grew by 0.1%, following the increase of 0.6%\nm\/m recorded in the previous month. Mortgage demand by individuals was\nunchanged on a monthly basis but rose 5.2% y\/y. Instalment credit increased by\n0.4% m\/m and 1.5% y\/y, the second consecutive month of increase on an annual\nbasis, following twenty consecutive months of decline. Overdraft facilities\nextended to individuals increased 1.1% m\/m, but increased by 5.1% y\/y. Other\nloans and advances (OLA) rose by 0.2% m\/m and 1.3% y\/y, displaying a slightly\nfaster rate of increase from the 0.8% y\/y growth recorded in April.<\/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 fourth\nconsecutive month declining by 1.2% m\/m, following the 0.8% m\/m contraction\nrecorded in April. On an annual basis, growth in credit extension to corporates\nslowed to 1.2% y\/y in May, compared to the 2.1% y\/y growth registered in April.\nOn a monthly basis, growth in mortgage loans, other loans and advances (OLA)\nand overdraft facilities extended to corporates were all stagnant. On a\nyear-on-year basis, mortgage loans contracted 2.4%, while OLA and overdrafts\nincreased 1.4% and 14.9% respectively.<\/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 deteriorated substantially during May, decreasing by N$2.7 billion to\nreach an average of N$340.8 million. The BoN attributed the diminishing liquidity\nposition to net transfers by investment managers as well as several\ncross-border transfers during the period under review. The outstanding balance\nof repo\u2019s subsequently rose to N$1.1 billion at the last week of the month. <\/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 latest money statistics release, broad money supply contracted by N$1.6 billion or 1.3% y\/y in May, compared to the 3.1% y\/y increase recorded in April. Foreign reserve balances declined by N$2.2 billion to N$39.0 billion in May. The BoN ascribed the decrease to an increase in government payments as well as foreign currency repurchases by commercial banks.<\/p>\n\n\n\n

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

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

The\nN$214.2 million or 0.2% m\/m contraction of PSCE growth in May is the third\nconsecutive decline on a month-on-month basis, while the rolling 12-month\nprivate sector credit issuance increased 48.7% y\/y from the low base of N$1.83\nbillion cumulative issuance as at the end of May 2020, with individuals\ncontinuing to take up most (85.8%) of the credit extended over the past 12\nmonths.<\/a><\/p>\n\n\n\n

Despite the historically low interest rates, economic\nactivity remains subdued, with individuals unwilling or financially incapable\nof taking out loans to increase consumption, and corporates who lack\nconfidence to invest in capital projects would rather use the opportunity to\nde-lever their balance sheets. With Namibia experiencing a third wave of\nCovid-19 infections, and with it, stricter lockdown measures which hampers\neconomic activity, credit extension is unlikely to improve in the short-term.<\/p>\n","protected":false},"excerpt":{"rendered":"

Overall Private sector credit (PSCE) fell by N$214.2 million or 0.20% m\/m in May, bringing the cumulative credit outstanding to N$105.0 billion. On a year-on-year basis, private sector credit grew by 2.66% in May, compared to the 2.74% y\/y growth recorded in April. On a rolling 12-month basis, N$2.72 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-28551","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\/28551","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=28551"}],"version-history":[{"count":1,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/28551\/revisions"}],"predecessor-version":[{"id":28558,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/posts\/28551\/revisions\/28558"}],"wp:attachment":[{"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/media?parent=28551"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/categories?post=28551"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ijg.net\/research\/wp-json\/wp\/v2\/tags?post=28551"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}