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AgriBank plans raising N$995 million for capital projects |
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Written by Staff Reporters
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AgriBank has experienced pressure on its liquidity over the past two years due to a mismatch between maturity profiles of its assets and liabilities, as well as negative publicity, said Chief Executive Officer, Leonard Iipumbu in a statement reviewing the bank's activities in 2006. However, Iipumbu said the bank has managed to repay its creditors in excess of N$150 million and was in the position of granting and disbursing new loans.
Through the implementation of its funding strategy, the bank intends to raise N$995 million over a period of five years at affordable interest rates to enable it to finance capital projects, said Iipumbu.
“The confidence in the market shall no doubt have a distinct effect on the growth of the loan book. A positive image of the Bank is therefore essential to investor confidence and the ability to raise affordable funding in the market,” he said.
AgriBank has set targets for the reduction of arrears with the development of an action plan outlining sound and workable procedures and targets for the recovery process. The bank has been in a position to recover between N$12 million to N$15 million per month as compared to N$4 million to N$7 million in previous years, which has substantially increased the bank’s liquidity position to meet its short-term commitments, said Iipumbu.
Last year, Agribank focused its efforts on improving agricultural production per unit hectare of available arable land to maximize food production. A total of 524 applications were received of which 264 were approved in the amount of N$44.4 million.
The bank entered into a lease agreement with Witvlei Meat (Pty) limited on 1 August 2006. Extensive market attractiveness studies conducted by the company together with their Norwegian counterparts inconclusively points to a successful enterprise, Iipumbu said.
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