NHB planning to set up mortgage finance company
The National Housing Bank (NHB) plans to set up a mortgage finance company in association with two or three partners including development banks by the end of this fiscal.
To start with, NHB has already identified Asian Development Bank and Washington-based International Finance Company (IFC) as prospective partners and is looking for a third strategic partner for technical expertise, who will have a 36 per cent stake in the proposed entity, according to Chairman R V Verma.
Briefing reporters, he said, “we are hoping for approval from Foreign Investment Promotion Board (FIPB) by December-end and the company will be set up by March 31 next year with initial capital of Rs 120 crore and authorised capital of Rs 750 crore.”
Currently, NHB is wholly owned by Reserve Bank of India (RBI) and is in the business of refinancing to banks and housing finance companies (HFCs) in case of default by home loan mumbai borrowers.
The application for mortgage finance company will be sent to RBI by January next year and the new company expected to start operating from April 1, 2012. NHB’s net profit was flat for 2010-11 at Rs 279 crore, against Rs 280 crore a year ago. Even as NHB’s net and gross non-performing assets were ‘nil’, its collection efficiency was 100 per cent, said Verma conceding that net interest margin was under pressure in 2010, which affected the bottom line.
NHB will focus on market infrastructure development to bring stability in the housing market. NHB Residex, the residential property price index launched this year, will include five more cities from January next year — Ludhiana, Vijayawada, Indore, Guwahati and Bhubaneswar.
Meanwhile, apex housing finance institution granted registration to five new housing finance companies in 2010, taking the total number to 52.
Processing your request, Please wait....
