Staff Writer
Namibia’s listed banking sector is showing mixed performance, with some banks growing while others face pressure, according to Simonis Storm Securities.
FirstRand Namibia reported headline earnings of N$1.066 billion for the first half of FY2026.
Return on equity reached 30.2%. Total assets declined by 2.6% after the bank exited its asset and liability management hedge.
Key indicators improved. The net interest margin rose to 6.3%. The credit loss ratio improved to 0.4%. Non-performing loans dropped to 4.3%.
The firm said the performance was supported by changes in funding. Franchise deposits increased by 9.4%.
Institutional funding fell by 26.7%. Interest expenses declined by 28.8%.
The bank’s cost-to-income ratio remained below 50%. Lower funding costs place it in a position to handle possible credit pressure. Simonis Storm maintains an “overweight” view on the stock.
Standard Bank Namibia reported profit after tax of N$1.187 billion for FY2025. Return on equity stood at 21.0%. All business segments contributed to earnings.
Asset quality improved. Non-performing loans declined to 4.34% under IFRS and 2.81% under regulatory measures. Impairments dropped by 35.8% to N$68 million. Operating expenses declined by 1.7%.
However, the firm raised concerns. Customer deposits fell by 4.5%. The loan-to-deposit ratio is about 83%. This may create pressure if liquidity tightens.
Simonis Storm described the outlook as “conditional but positively asymmetric” and advised investors to accumulate the stock while watching deposit trends.
Capricorn Group reported a 13.5% drop in profit after tax to N$920 million for the first half of FY2026. Return on equity declined to 15.0%. Revenue remained stable at N$2.742 billion.
Profit fell due to rising costs and impairments. Credit impairments increased by 53% to N$286 million. The non-performing loan ratio rose to 4.9%. Operating expenses increased by 11.2%, driven by higher spending on technology.
Simonis Storm said the group is entering a more difficult phase, with higher costs affecting earnings. It said the credit cycle is weakening as pressure builds from oil prices and inflation.
The firm said a recovery will depend on three factors: stabilising non-performing loans, slower growth in impairments, and lower cost increases. “None of these conditions are currently met,” the firm said.
It maintains an “underweight” view and advises investors to reduce exposure until performance improves.
