Agribank to auction off two farms

THE Agricultural Bank of Namibia yesterday announced that it will auction off two farms in the Otjozondjupa region on Friday.

The auctions follow an announcement last week by the bank that it had moved from a soft to a hard collections approach against debtors.

In a press statement, the bank’s chief executive officer, Sakaria Nghikembua, said this was a warning to other clients who are in arrears to settle their debts before it is too late.

Earlier this year, the bank warned that it will repossess and auction farms belonging to defaulters who owed about N$500 million collectively, and who failed to comply with the bank’s demands and those of debt collectors to pay their arrears. The bank also said some farmers had not paid a cent towards their debts for the past five years.

Agribank embarked on a debt collection campaign last year with the aim of recovering about half-a-billion dollars owed by farmers.

The latest move is part of the bank’s decision to take a more aggressive approach in debt collection. Nghikembua said both farms have already been advertised in the local media.

“This is the last resort for us. There is no other option but to execute on the auction. The only thing that can stop the process now is payment of the arrears by the clients before the auction date. In the absence of that, the process will go through to the end,” he stated.

He added that these two auctions should not be seen in isolation, but as part of an ongoing series, emphasising that if clients persistently fail to honour their loan repayment commitments, the bank will dutifully follow the same route.

Nghikembua said the bank had not only geared its internal structures to implement recovery strategies faster than in the past, but has also bolstered its collection efforts by recently adding a new law firm to its legal collections panel. Last week, the bank likewise announced that clients who have defaulted will be listed on credit bureaus.

“If a client waits until they are listed or until we have a judgement against them, it will be too late. The best is to avoid these two situations by making repayment commitments, and making every effort to honour such commitments,” he stressed.

The bank has close to 6 000 clients, with a loan book value of N$2,4 billion. The government finances some of Agribank’s loans through the Ministry of Finance.

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