Friday 25 July 2014

More Competition for Banking Sector in Namibia

NEWLY licenced banks, Letshego Bank Namibia and Banco Privado Atlantico Europa are expected to increase competition in the banking sector.
The commercial banking space has long been dominated by FNB Namibia, Nedbank, Standard Bank and Bank Windhoek, the largest commercial banks.
Last week, the Bank of Namibia announced that the Botswana based, Letshego and the Portugal based Banco had been granted provisional licences for six months.
Mythri Sambasivan-George, head of corporate affairs at Letshego says the group plans to become a leading African financial services group.
George said future plans include building deposit taking capabilities, diversifying into and microfinance lending.
"The issue of this provisional licence is a key milestone in its transformational journey and will enable the group to meet its commitment to improve lives and financial inclusion in Namibia. This is the third deposit-taking micro financial licence obtained across the group's ten country footprint in Southern and East Africa," said George.
Letshego was formed in 1998 and has been publicly listed on the Botswana Stock Exchange (BSE) since 2002.
It is a holding company with consumer and micro lending subsidiaries across 10 countries in Southern and East Africa - Botswana, Kenya, Lesotho, Mozambique, Namibia, Rwanda, South Sudan, Swaziland, Tanzania and Uganda.
Letshego is the second largest quoted company on the Botswana Stock Exchange with a market capitalisation in excess of US$550 million.
The group offers loans between US$1 000 and US$40 000. In the year ended 31 January 2014 advances increased by 33% to US$500 million and profit before tax for the same period was recorded at US$ 97 million.
CEO of Banco Privado, Diogo Cunha, declined to comment on future plans.
"At this moment we do not have additional comments. We will certainly contact you to share more information once we are nearer to the date of opening," Cunha said. The shareholders of Banco Privado Atlantico Europa are, Surviving Global, Asset Management, SA (72,3%), Banco Millennium Angola, SA (6,7%) and management (21%).
In April, Reuters reported that another bank with Portuguese and Angolan connections, Banco BIC, backed by the billionaire daughter of the country's president and a Portuguese cork tycoon, was planing to ramp up its branch network at home while also expanding overseas to operate in four continents.
BIC opened an office in Johannesburg in February and applied for a licence to operate in Namibia.
Isabel dos Santos, daughter of Angolan President Jose Eduardo dos Santos and who ranks as one of the continent's richest businesswomen, owns a quarter of BIC Angola. Americo Amorim, one of Portugal's richest men, also owns 25%, Reuters reported.

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