The Development Bank of Namibia (DBN) has carried out a balance sheet clean-up, writing off about N$579 million in non-performing loans during the 2024/25 financial year.
The bank says it is navigating a "complex economic environment" with a shrinking loan book and a shift towards climate financing.
According to the bank's latest annual results for the year ended 31 March 2025, the total loan book value decreased to N$5.8 billion, down from N$6.2 billion the previous year.
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This decline was driven by three primary factors: the massive write-offs of long-outstanding accounts, a cautious approach to new lending and accelerated repayments from the National Energy Fund.
"The net interest income, a critical indicator of the bank's financial sustainability, contracted by 25% year on year, declining from N$450.6 million in 2023/24 to N$337.4 million in 2024/25," reads the report.
The total outstanding balance of restructured loans amounts to N$2.3 billion, an increase compared to N$1.6 billion in 2024. However, expected credit loss decreased to N$1.683 billion from N$2.216 billion.
"The decrease is primarily due to the utilisation of the provision from written-off notes... All provisions raised reflect the bank's best estimates based on available data and scenario analysis and are considered appropriately prudent," reads the statement.
Board chairperson Evangelina Nailenge says the bank is on a path of transition that will safeguard its financial health.
She adds that priorities for the new financial year include strengthening financing for small and medium enterprises (SMEs).
"Priorities in the year will include unlocking climate finance, supporting strategic sectors, strengthening SME financing and maintaining governance excellence," says Nailenge.
The annual report shows that DBN approved N$912.7 million in loans.
The bank approved 49 SME projects of which N$51.5 million was awarded to women-owned enterprises, while youth-owned businesses received over N$24 million in financing.
DBN chief executive at the time of the release, John Mbango, says the bank delivered a solid financial performance, despite operating in a complex economic environment.
"While challenges such as a contracting loan book and pressure on asset quality remain, decisive measures are being taken to stabilise risk and restore growth," he says.
Mbango adds that DBN became the first institution in Namibia to be accredited by the Green Climate Fund as a direct access entity in the medium accreditation category.
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This allowed the bank to raise up to US$250 million in climate finance.
"We secured N$607 million through the KfW Green Credit Line II and received approval for a landmark N$1.5 billion sovereign-guaranteed facility from the African Development Bank," says Mbango.
He adds that DBN will focus on strengthening relationships with government bodies to enhance support for initiatives and expand community engagement programmes to connect with local businesses.
