"We are planning to go for retail issue of our tax-free bonds in the third week of this month," NHB Chairman and Managing Director R V Verma told PTI.
Of the total issue size, he said, Rs 3,750 crore has been earmarked for retail investors while remaining Rs 1,250 crore for private placement to institutional investors. As per the budget proposal, NHB was allowed to raise Rs 5,000 crore from the tax-free bonds during 2012-13. Currently, the private placement option is open for institutional investors to subscribe such bonds.
The issue closes on February 6. The fund raised will be utilised for promoting affordable housing, he added. Besides, he said, National Housing Bank (NHB) has reduced its benchmark lending rate by 0.25% to 9.75% to promote housing market in the country. "The floating rate Prime Lending Rate (PLR)-linked refinance portfolio of NHB will now be repriced at 0.25% less," he said. Also the bank, decided to reduce interest rate on special refinance scheme by 0.25%. The refinance rate has now been reduced to 8.25% from 8.50% in respect of loan up to Rs 5 lakh and 8.50% from 8.75% per annum for loans up to Rs 10 lakh, he said. The scheme provides long-term fixed rate refinance at affordable rates of interest for construction or purchase of houses in urban areas to people in the lower income segments, including those engaged in the informal sector.