By Baronice Hans, Managing Director of Bank Windhoek
Global Credit Ratings has affirmed the national scale ratings assigned to Capricorn Investment Group Limited of AA(NA) and A1+(NA) in the long term and short term respectively; with the outlook accorded as Stable. Global Credit Ratings has also affirmed the national scale ratings assigned to Bank Windhoek Limited of AA(NA) and A1+(NA) in the long-term and short term respectively; with the outlook accorded as Stable. Furthermore, Global Credit Ratings has affirmed the long term South African national scale (Rand) issuer rating of A+ (ZA) assigned to Bank Windhoek Limited; with the outlook accorded as Stable.
Global Credit Ratings (GCR) accorded the above credit ratings to Capricorn Group and Bank Windhoek based on the following key criteria:
The accorded ratings reflect Capricorn Group’s strong domestic market share in the Namibian banking industry and significant presence in the asset management and insurance markets. The ratings also reflect Capricorn Group’s risk appropriate capitalisation, comfortable liquidity, resilient earnings performance, as well as further earnings and geographic diversity from recent acquisitions (January 2017) of banking operations in Zambia and Botswana, contributing a combined 17.9% to group consolidated assets at FY17 (30 June 2017) and 3.8% of pre-tax profits. While GCR expects the Group to remain resilient, the prevailing economic challenges and an uncertain global economic outlook, will continue to put pressure on Capricorn Group’s (and the financial sector in general) earnings and asset quality metrics.
Bank Windhoek, the Group’s leading operating subsidiary, is the largest locally owned bank and second largest commercial bank in Namibia. Bank Windhoek contributed an 80.1% of the Group’s consolidated assets at FY17 (FY16: 98.2%) and a higher 87.0% (FY16: 86.6%) of pre-tax profit following recent acquisitions.
While the Group’s ratings have largely replicated Bank Windhoek’s ratings, GCR has taken cognisance of added diversification benefits from recent acquisitions at Group level.
We are proud of maintaining our credit rating score and believe that with our staff’s dedication and determination, it will be maintained for the considerable future.