Staff Writer
Standard Bank Namibia is unlikely to benefit from near-term interest-rate easing, with Simonis Storm Research expecting the June rate increase to support revenue through its large deposit franchise while creating a trade-off through pressure on asset quality.
Simonis Storm said the 25-basis-point increase in Namibia’s policy rate to 6.75% in June, following South Africa’s move to 7.00%, was aimed at defending the currency peg.
The research house therefore does not expect monetary easing, despite management’s view that lower rates could provide relief to households.
For Standard Bank Namibia, Simonis Storm said the higher-rate environment is positive for revenue but negative for asset quality, a trade-off reflected in its revised forecasts.
Customer deposits increased 31% to N$39 billion in the first half of 2026, driven by a 51% increase in current accounts and a 25% rise in call savings.
The research house said the deposit growth is positive for the bank’s cost of funds, but noted that inflows have outpaced the deployment of funds into customer lending.
Gross loans to banks more than doubled to N$7 billion, while financial investments increased 26.3% to N$11.1 billion. Of the latter, N$2 billion represented short-term placement of surplus liquidity.
This means roughly N$9 billion was held in bank loans and short-term or liquid investments rather than customer loans, limiting the immediate earnings benefit from the larger deposit base.
Total assets increased 27.3% to N$51.4 billion, while return on assets declined by 37 basis points to 2.46%. Net interest income relative to average total assets also fell to 4.73%, from 5.34%.
Simonis Storm attributed the decline predominantly to the change in balance-sheet mix rather than franchise pricing, arguing that the pressure should reverse as excess liquidity is converted into customer lending.
The bank also maintained tight control over costs. Operating expenses rose 3.5% to N$1.04 billion, below Namibia’s 4.4% inflation rate.
Staff costs increased 8.7%, while IT costs rose 1.0% and other operating expenses declined 3.4%, helped by lower premises and professional fees following the Spearmint disposal and branch optimisation.
