Bank Proving to Be Good Investor

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By Wezi Tjaronda WINDHOEK The Development Bank of Namibia last year approved seven projects with a combined value of N$110.7 million. It extended loans to Aqua Utilities Corporation, Cenored, Namibia Poultry Industries, Namibia Stone Processing, Nampost Holdings, Ongopolo Mining and Processing and also to the Ongwediva Town Council. The projects, which are located in six different regions, are expected not only to create new jobs but will also retain close to 2 200 existing jobs. Aqua Utilities, which supports operational efficiency in the fishing industry through the provision of cost-effective water solutions, created two new jobs and indirectly benefited 1 000 jobs in the fishing sector, while Cenored employed 40 new technicians and saw the retention of 60 others. The establishment of Cenored is part of the national undertaking to rationalize the electricity supply industry to ensure efficient delivery of power to consumers. The Namibia Stone Processing company, located in Omaruru, Erongo Region, currently generates around N$63 million in exports, but expected to increase to N$90 million through local processing. The company, among the first to receive loans from the DBN, has employed 32 new local technicians and artisans and according to the bank’s ‘Chief Executive Officer’s Report’, the company has had a positive impact on Omaruru, where it is based. “The project’s growth gave rise to a number of other projects, notably the development of a new shopping center in the town. “Moreover, the project is important on a national level as it is the biggest dimension stone cutting and polishing factory in Africa, thus establishing Namibia as a serious contender in world class dimension stone processing,” DBN’s Chief Executive Officer David Nuyoma said. While Nampost Holdings enabled low- income groups to assess electronic banking, the copper mining company Ongopolo retained its copper mining activities and Ongwediva Town Council housing development will increase its potential as a premier investment location. The bank’s 2005 annual report says the projects supported by the bank will enable 18 350 or six percent of the population to have access to improved infrastructure. Apart from creating and retaining jobs in four key economic sectors, the support to the projects created new skills transfer opportunities as 25 percent of the approvals went into creating new industries, while 55 percent of the projects approved have Black Economic Empowerment ownership. In addition, the bank said every N$1 invested is expected to generate N$8 in exports and save N$8 in imports. DBN has also entered an agreement with Bank Windhoek, through which it finances small and medium enterprise activities. The bank has made a commitment of N$30 million to the SME sector, of which N$10 million was advanced to the bank in 2005. As of June 2006, a total of 22 projects was approved and N$15 million was committed. The projects, which are based in Katima Mulilo, Ohangwena, Swakopmund and Windhoek, are projected to create and retain 191 jobs. Last year, DBN reported a profit of N$27 million in income from lending activities (N$2 million) income from investments (N$16 million), a grant from the Bank of Namibia (N$20 million) and interest earned on the inherited Development Fund of Namibia investment portfolio (N$1.1 million). During the last financial year alone, the bank received a total of 94 loan applications with total costs amounting to N$2.6 billion, of which funding required from the bank was N41.7 billion.