Martin Endjala
Trustco Group Holdings Ltd. (TGH), the parent company of Trustco Bank Namibia Limited (TBN), has until Tuesday to provide the Bank of Namibia (BoN) with a deposit plan.
This follows TGH’s decision to return TBN’d banking license to the BoN for cancellation with immediate effect.
Quinton van Rooyen, Chairman of Trustco Group Holdings’ Board Investment Committee, disclosed this information in a statement last week.
“In light of recent developments, Trustco has decided to exit from investing in deposit-taking institutions in Namibia. Our focus is now shifting towards non-deposit-taking financial services, where we see tremendous growth potential,” he said.
According to Van Rooyen, the BoN fully secures and holds all depositors’ funds.
Last week, TBN announced its decision to exit its investment in its commercial banking portfolio, which accounts for less than 1% of its total investments.
On April 23, 2024, the company announced its intention to increase its stake in Legal Shield Holdings Limited to 91.35% by acquiring an additional 11.35% interest for N$468 million.
Van Rooyen stated that this move will significantly strengthen its position in Namibia’s insurance and real estate sectors, both of which are poised for substantial growth in the post-pandemic era.
This was after the institute failed to comply with the Banking Institutions Act.
“On 18 August 2023, the Bank of Namibia, in accordance with Section 15(5) of the Banking Institutions Act of 2023, after consultation with the Minister of Finance and Public Enterprises, resolved to suspend the authorisation of TBN to operate as a banking institution with immediate effect,” he said.
The central bank’s spokesperson, Kazembire Zemburuka, confirmed this in a statement last week.
On 29 July, Zemburuka explained that it issued a notice of its intention to cancel TBN’s authorisation to conduct banking business in terms of Section 15(2) of the Act due to its failure to remediate the suspension conditions.
He said BoN gave TBN a chance to persuade the bank not to revoke its banking institution authorisation.
BoN had previously issued a directive to TBN to ring-fence depositor funds in a bank account held with a Namibian banking institution.
TBN has been operating in the Namibian market since December 2016, when it obtained a commercial banking license after acquiring Fides Bank.
