Nampro Fund to make a dividend distribution of N$10.4m
The Namibia Procurement Fund is set to make a dividend distribution of N$10.4 million towards the end of this month to the Government Institutions Pension Fund (GIPF), The Villager has learnt.
This dividend distribution is meant for the 2014/15 financial year.
This is a massive increase from the N$7.8 million dividend distribution made to the GIPF during the 2013/14 financial year.
It’s also the third consecutive financial year that the NamPro fund is able to hand over dividends to its founding investor, the GIPF.
NamPro has furthermore disbursed over N$350 million to small and medium enterprises (SMEs) to date since its inception five years ago.
This money benefited over 150 SMEs in the country, which are comprised of sole proprietors, close corporations and companies from different trades.
To date, 4490 jobs were created through the funding of SMEs.
NamPro Fund’s Managing Director Kauna Ndilula told The Villager that while the NamPro Fund pays taxes through VAT and Income Tax, it is their policy not to assist any client with outstanding taxes, or who is non-compliant to the relevant tax laws.
“The dividend policy is to distribute 100% of the net profits each year, and we are confident that the dividend for the year ending March 31, 2016 will be more than double the dividend distribution for this year,” Ndilula enthused.
As the NamPro Fund is regulated by the Namibia Financial Institutions’ Supervisory Authority (Namfisa), it argued that Namfisa continued shunning the organisation as a recognised Special Purpose Vehicle (SPV).
NamPro maintained that without SPV status, the Trust remains banned from accepting pension fund money for investment purposes.
SPVs are seen as legal entities which focus on areas of precedence, and who act as mediators to manage the funds allotted to them by pension funds.
Namfisa refused to recognise NamPro as an SPV because it chiefly deals with close corporations (CCs), as opposed to dealing with the more strictly-regulated proprietary companies.
Despite NamPro’s core business being CCs, Namfisa cited that CCs are not secure enough. Thus, they are a risky business.
Meanwhile, Namfisa hit back, saying that the NamPro complaint of being recognised as an SPV in terms of the country’s Pension Fund Act ought to be taken up with legislators, instead of taking it up with the regulator overseeing the process.
In a statement, Namfisa maintained that it was only following the book as it’s authorized to register and supervise SPVs in accordance with Regulation 29 of the Pension Funds’ Act.
Namfisa further noted that this regulation does not empower Namfisa to exempt any entity from complying with the provisions contained therein.
The regulatory body maintained that NamPro’s involvement with CCs was among the ‘issues’ raised, reiterating that SPV investments exclude exposure to CCs.
An SPV is a distinction reserved for smaller businesses, and CCs are generally authorised to function without the strict formalities mandatory in the operation of standard corporations, and is generally closed to investment from the public.
However, Ndilula noted that the Nampro Fund being regarded as an SPV is still under consideration by Namfisa.
She revealed that the Fund took heed of Namfisa’s issues raised, and has registered the Namibia Procurement Fund II, which will only focus on assisting SMEs which are registered as Proprietary Limited (Pty) Ltd companies.
They have since applied to Namfisa to have the Fund II recognised as a Regulation 29-compliant SPV, whereby pension funds can invest into this SPV in order to meet the said requirements.
At a press conference earlier this year, the chairperson of the Fund, Derek Wright also said if the Fund fails to receive SPV recognition, it might be forced to close down.
Meanwhile, Ndilula said the Fund will not face any closure as it is committed to assisting SMEs to execute their supply contracts or tenders that they would have been awarded.
“The Namibia Procurement Fund falls under the discretionary portfolio of our investors, and will continue to assist SMEs who are incorporated as close corporations in Namibia,” she stressed.
The GIPF recognised the NamPro Fund as an SPV to provide short-term working capital facilities and medium-term asset-backed financing to SMEs awarded tenders or supply and service contracts with reputable entities.
by Charmaine Ngatjiheue