Regulatory Alerts2019-11-07
Regulations on Loan-to-Value Ratios for Namibian Banking Institutions
The Namibian Minister of Finance, acting on the Bank of Namibia’s recommendation, has issued regulations imposing loan-to-value (LTV) restrictions on mortgage loans for residential properties. Banking institutions must apply LTV caps of ninety percent for second properties and eighty percent for third or subsequent properties, while prohibiting the financing of required deposits through equity or external borrowing. Banking institutions must establish board-approved compliance procedures, verify customer declarations regarding property ownership and deposit sources, and face fines up to N$100,000 or imprisonment for contraventions.
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