After about nine years at the helm of the Development Bank of Namibia, David Nuyoma will leave for new pastures at the end of the month. On January 1 2013, he becomes the new principal officer at the Government Institutions Pension Fund (GIPF).
When applied for the position as founding CEO of the DBN in 2003, Nuyoma was still running the Namibia Investment Centre. He started at the DBN with nothing: no office, no telephone, no fax and no computer. True to form, Nuyoma wasn’t fazed – he started doing DBN business on his cellphone.
The communications department of the DBN interviewed Nuyoma on his experiences during his time with the bank.
DBN: What were the challenges?DN: We started with seed capital of N$100 million and the initial challenge was how to make the bank function effectively, efficiently and be respected in the market with that level of capitalisation.As we were established as a development bank, and especially when considering the DBN’s mandate as per its act, we knew we had to finance larger types of businesses.With N$100 million in the kitty, what do you do? Our initial single obligor limit was N$20 million. This was the single biggest exposure we could have per project. With such a narrow capital base and no track record, nobody wanted to get involved with us at that stage. We couldn’t go to the market and say we would like to raise a certain amount, with no track record and the prevailing views on development finance institutions (DFIs). That was a challenge. The big deals would come and go, and be taken by other DFIs in the region and also from outside, especially European DFIs active in the market. It became an imperative for us to find a way to grow the capacity of the bank for it to become a meaningful entity in the market. The second challenge was that there seemed to have been very few good deals in the market, which the entire financial services sector competed for. When we sorted out our policies, getting good deals remained a challenge, but we managed to play our part within the limitations we faced at the time. The third challenge, which is also a perennial for DFIs, is that there are many entrepreneurs out there with very limited resources to offer as own contribution or as security or collateral. It has always been a challenge to identify those that will succeed from that pool and where the bank could be exposed without sufficient security. DBN: What would you consider the highlights of your time at DBN?DN: Firstly, the bank’s launch on April 29 2004 and the unveiling by President Sam Nujoma of our plaque, remains a personal highlight for me and a historical moment for the bank. The second highlight was the first loan approvals made public on July 14 2005. This was an important milestone for us as it was our first baby step through which we could show that we have arrived and that we were ready to do business.The third was to see the businesses that have been established, to visit the projects, talk to the promoters, to see the employees working in those projects and to see the goods and services that these projects are making as a contribution to the development of this beautiful country. This is what actually inspired me throughout my time at DBN, because I believe that these are the building blocks of what ‘development’ constitutes. DBN has made a contribution in all the economic sectors and the impact of the projects it financed will become more pronounced as time goes on. DBN: What gave you the greatest satisfaction at the DBN?DN: Seeing our clients’ success, when they pay off their loans and having established standing businesses, whether private, public or SMEs.The Caprivi Interconnector Power Line, for example, is one of those projects that gives me the greatest amount of joy. When I see IUM, with its thousands of students and projects like Scooters Pizza with its three branches, I am very proud. In the south, there is the dairy farm, the tannery that exports its products, and houses that were built to replace the corrugated and rusted dwellings in Lüderitz. In the northern regions, when I look at Ongwediva Medipark, and Armstrong construction in Kapako, I am filled with a deep sense of satisfaction. Next to these flagship projects, however, lies the pain, too, when a client you trusted is not performing. When we agree to finance a project, it is on the understanding that it will be used in an efficient manner. But when you see that clients don’t pay and use the money for things that are not productive, it the worst pain you can get.DBN: What would you say were the lessons learned?DN: Always do the right thing, despite what may be convenient in the short term. Think long term. I also know that development work is not a bed of roses. It is filled with trials and errors. It requires sober-mindedness, and prudence, but action must be taken. We cannot afford to be passive. We must take calculated risks. DBN: What was your greatest achievement?DN: DBN is here and it is here to stay. It has become a known brand, a household name, which is easily recognisable. The impact of its contribution is already being felt but will become more evident over time. DBN: What legacy would you want to leave the DBN and what are your hopes for it in future?DN: The legacy that I wish to leave is an organisation with a high level of integrity and performing on its mandate, not only financially, but in terms of development impact by making a difference in the economic landscape of the country in a positive way. I keep saying that we’ll see DBN’s impact over time. Give DBN five more years, the whole country will be covered, and there won’t be any place you go where there won’t be a DBN client working hard to advance progress in Namibia.
