Namibia’s financial sector is one of Africa’s most sophisticated, and is world class in many aspects. A local banker likes to recall the reaction of a friend visiting the country for the first time. The friend, a Canadian, was surprised when they came across an ATM in the middle of nowhere, but was even more impressed when the banker got a text message confirming his withdrawal almost before he had put the money into his wallet. “He said they don’t have that in Canada,” says the banker. “When a Canadian compliments your banking system, you know it’s good.”
As well as being technologically advanced, the banks are well regulated. The Bank of Namibia, the central bank, stipulates that they must have capital adequacy ratios of at least 10% (the figure for the industry at the end of June this year was almost 14.5%) and leverage ratios of 6% or more. They have operated under Basel II since early 2010 and are already working towards complying with the third Basel framework. The World Economic Forum recently said they formed the second safest banking system in Africa, after South Africa.
