Foreign banks allowed to operate branches in Namibia
The Bank of Namibia now has the ability to decide on the ownership of financial institutions in the country and issue fines to both the banks and their controlling companies.It has gained the powers following the altering of existing legislation, a move that has been criticised by many in the nation's financial sector, the Namibian reports. Existing lenders are unhappy that foreign banks are now allowed to operate branches in Namibia and the Bankers' Association of Namibia had previously threatened legal action over the changes.
Ipumbu Shiimi, Governor of the central bank, said it will be focusing on increasing the local ownership of banks next year. Almost two-thirds of the local banking sector is owned by overseas enterprises and Mr Shiimi was quoted as saying there needs to be an "acceptable blend" of domestic and foreign ownership.
Earlier this month, the news source reported all commercial lenders in Namibia have reduced their prime lending rates to 10.5 per cent at the request of the central bank.