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Thursday 23 May 2019
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Agribank Board chair gets N$20mil loan

Chairperson of Agribank, Michael Iyambo has been accused of enjoying preferential treatment at the expense of hundreds of indebted commercial farmers by getting an additional loan on top of N$20 million he is said to be currently struggling to pay back.
Iyambo has flatly denied these revelations.
Sources have alleged that Iyambo has been using his influential position to enjoy a loan restructuring while he shifted his corporate loan from Agribank to Bank Windhoek only to later shift it back to the bank when he rose to the helm as its chairperson.
Iyambo is also said to be caught up in a loan-repayment negotiation storm with the newly birthed Previously Disadvantaged Namibian Commercial Farmers Union.
The union chairperson Jane Kuhanga, this week told this publication that Iyambo has refused to entertain them in their bid to strike a favorable deal under which they can pay back their loans.
Sources who spoke on condition of anonymity for fear of retribution, alleged that the chairperson was crushing their hopes as black emerging farmers.
“That member is unfortunately using his position to his own benefit and denying his fellow black farmers to benefit. He was struggling to pay his Agribank debts and then transferred his corporate loan to Bank Windhoek and when he joined the board he then transferred and restructured his loan back to Agribank. His loan was restructured and he got an additional loan.
His total exposure is more than N$20 million and he is struggling to pay back that loan since he got the loan. The bank allowed him to shift his installments three times and the loans were not even 100% secured. If people get into positions of authority to benefit themselves, is there hope for other farmers out there?” asked the source.
Iyambo refused to engage with The Patriot in a face to face interview and opted to respond in writing when he was afforded a right of response.
Agribank hits back
In an emailed response, the bank said it does not discuss individual loan account details with third parties including the media as such information is confidential.
“However, in this instance, we can confirm that Mr. Michael Iyambo, who is also the Chairperson of Agribank Board of Directors, is a client of the bank.  From the status of his accounts, the bank cannot classify him as struggling to pay back his loans,” said Agribank.
The bank added that the alleged N$20 million loan amount advanced to him was being exaggerated.
“As a matter of policy, the bank treats Mr. Iyambo’s account in exactly the same way as it treats all other accounts. This means that he is expected to repay his loans or, if necessary, make appropriate repayment arrangements which he must honour. We do not have exceptions to this requirement and it would indeed be good to prove factually otherwise,” said the bank.
The bank could not deny or confirm that Iyambo got an additional loan as alleged, stating that it is very common for one client to have multiple loans.
“This is the same with many of our clients specifically because the bank finances different products. For example, a loan for equipment would be different from a production loan or a loan for farmland.”
“The client would thus apply for different loans and all these would go through the same process. All of Mr. Iyambo’s applications were done at the time of move-over. It is disingenuous to want to suggest something extraordinary here.”
Agribank flatly denied that Iyambo was using his influential position to run his farm at the expense of struggling farmers. The bank said it was “unfortunate that the so-called previously disadvantaged farmers go to the extent of trying to create a false impression that something is amiss and that the bank is providing preferential treatment to a client”.
Agribank said it has relevant governance structures in place to ensure that at all times its interest is not compromised. Agribank could not deny that the chairperson shifted his loan from Bank Windhoek but it denied that he did so when he became chairperson.
Rather, it said that he shifted his loan from the bank because it had poor service.
“The bank competes with commercial banks for agribusiness on a daily basis. Towards this end, we have many clients whom the bank takes over from these competitor banks. Before we take over any loan, a thorough credit assessment of the client and his or her business is conducted.”
“First, the branch takes in the initial application and conducts the initial analysis. Then the credit division does its assessment as well. Only after the application has passed that stage would it proceed to the management credit committee, the board Credit Committee and, depending on the amount in line with the financial delegation of authority, the full Board,” said Agribank.
It said Iyambo’s application went through all those credit appraisal loops, and was approved by the Board in 2017. “Mr. Iyambo became chairperson of the Board only in September 2018.
The entire assessment process was done with the full recusal of Mr. Iyambo, as per the bank’s governance requirements. We wish to point out that Mr. Iyambo’s application was submitted and approved by the previous Board, of which he was not chairman.”
“It is thus false to assert that he moved his loan to the bank when he was chairperson. Mr Iyambo previously moved his loan to a commercial bank because of poor service from the bank. However, the bank challenged him as to why he serves on its Board whilst supporting a competitor,” said the bank.  Meanwhile, the previously disadvantaged farmers’ union chairperson Kuhanga, reiterated that Iyambo’s board resolved to decline meeting with them to resolve outstanding issues of unpaid loans. “Since we started to engage Agribank, we really tried to sit around the table with them and to see how we can then reach consensus that is beneficial to all the farmers and the bank as an entity. Agribank tried by all means to say that they are not going to see us. At one point in time we tried and they granted us a credit committee meeting just before the dissolving of the previous board.”
“We had some resolutions taken with this credit committee which were now supposed to be tabled at a full board meeting of Agribank but that could not materialise because that board was dissolved and a new board was then established,” she said.
Kuhanga added that attempts to continue engagements with the new board were in vain while, on the other hand, Agribank has maintained that it wants clients to approach it on an individual basis.
“Agribank said we are not going to have a meeting with you. It was a resolution by the board not to engage the farmers. So that is the conclusion that we heard from them,” she said.




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