The Bank of Namibia last week turned down applications for banking licenses from South Africa and Mauritius for not meeting the minimum banking requirements, as per the Banking Institutions Act of 1998.
However the monitory authorities approved provincial banking licences for a Botswana and Portuguese applicants in the same vein
Although BoN is not at liberty to disclose information of this nature, BoN says that there are Namibian players involved in acquiring of banking licenses that have been granted to foreign banks. Last week, Wednesday, BoN officially confirmed the approval of the application made by Letshego Financial Services (originally from Botswana) for a six month provisional banking license.
Angola’s Banco Privado Atlantico, which is a branch of a foreign banking institution from Portugal, was granted a banking license to operate in Namibia. It is one of the applicants that had applied alongside South African and Mauritius bankers who were not approved to apply in Namibia.
“Bank of Namibia can confirm that application for licenses originated from South Africa and Mauritius did not meet the minimum licensing criteria as per the Banking Institutions Act of 1998, as amended and they were declined” ” Ndangi Katoma, Director of Strategic Communications and Financial Sector Development said.
Katoma added that the benefits that Namibia will derive from the licensing of such banking institution depend on the business case such entity present and execute to enhance banking business in the country he also added this could create more competition in the banking sector, and hopefully banking services may become affordable.
BoN says that information pertaining the origin of countries where the previous license applicants originated from is very sensitive and confidential given the strategic nature of banking operations, therefore Bank of Namibia does not disclose such information. The bank can however confirm that there is Namibian ownership participation in most of the banking institutions under the purview of the Bank of Namibia
Katoma said that there are no restrictions that prohibit Namibian nationals to apply for banking licenses but that banking business is a highly regulated environment and very capital intensive.
“Banking business also requires extensive banking knowledge, experience and skills in relation to many ordinary businesses or companies registered in terms of other laws. Further, the business of banking institutions is subjected to different requirements and more stringent regulations. This is to protect the depositor’s funds because banking institutions serves as transmission mechanisms in the economy by using money from the general public (savers) to make loans to other people (borrowers)” he said.