Agribank CEO Dr. Raphael Karuaihe has issued a strong rebuttal against claims that the Bank unfairly targets farms owned by previously disadvantaged Namibians for auction, stating such actions are a final measure, not a primary strategy, and are crucial for the institution’s survival and future lending capacity.
The statement, released yesterday, addresses recent allegations suggesting the Bank’s recovery practices undermine the objectives of the National Land Reform Programme. Agribank firmly denies these accusations, asserting its core mandate is empowerment through financial support, not repossession.
Dr. Karuaihe emphasized Agribank’s legal foundation as a development finance institution established by the Agribank Act of 2003. This Act mandates the Bank to provide loans to the agricultural sector while also empowering it to secure repayment through collateral and, ultimately, repossession if defaults occur and all other recovery efforts fail. Public auctions are identified as the mechanism for such repossessions.
“Farm auctioning by Agribank is not our objective, but the last resort,” the CEO stated. He outlined specific scenarios where auctions become necessary: when a client fails to engage with the Bank’s communication; when agreed repayment arrangements are broken; when no arrangements are made at all; or when no payments have been made since the loan was initially disbursed.
The statement underscores the critical link between loan repayment and the Bank’s ability to function. Dr. Karuaihe warned that widespread defaults threaten Agribank’s sustainability, making it harder to raise funds needed to support future generations of farmers, particularly youth and emerging entrants. Capital injections, whether government funds or borrowed finance, must be repaid and recycled. Client commitment to repayment is therefore framed as essential for the Bank’s continued developmental role.
Agribank highlighted its efforts to support clients facing challenges, acknowledging the harsh climate and volatile economic conditions. The Bank offers flexible repayment alignment with cashflow cycles, loan restructuring, relief programmes, and free advisory services and training to strengthen farm management and financial planning skills. The Bank also encourages clients with multiple income streams to make regular payments to reduce installments proactively.
A central plea in the statement is for early dialogue. Agribank stressed that recovery efforts always begin with direct engagement to understand client difficulties and explore solutions like revised payment plans or grace periods. The Bank “strongly calls on clients to initiate dialogue long before matters escalate to legal enforcement.” Proactive engagement, it argues, can prevent debt from spiraling out of control and offer feasible turnaround options.
Dr. Karuaihe concluded by framing the Bank’s sustainability as a “shared responsibility.” While committed to working with clients to turn farms into productive assets, the ability to continue supporting Namibian agriculture for future generations depends fundamentally on clients honouring their repayment obligations. The Bank remains open for discussion with all clients to find solutions before the drastic step of auctioning farmland becomes unavoidable.