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| NHB to raise Rs 12,000 cr by June 2010 |
| Vrishti Beniwal / New Delhi Oct 30, 2009, 00:33 IST |
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National Housing Bank (NHB), a wholly-owned subsidiary of the Reserve Bank of India (RBI) for promoting housing finance institutions, is planning to raise Rs 12,000 crore, primarily through bonds, by June 2010. As a first step, it is planning to raise Rs 500 crore through bonds in the next two weeks.
“We will mostly be raising funds from the market, mainly taxable bonds. We can raise funds at a good price because the market is doing well. We will also try for low-cost funding from the government and RBI,” NHB Executive Director RV Verma told Business Standard.
NHB is also negotiating a $500-million credit line from World Bank. The discussions, however, are at an “early stage”. The Rs 12,000 crore it plans to raise in this financial year (it follows the July-June cycle) also comprises a budgetary allocation of Rs 2,000 crore for refinancing housing finance companies. It will also get up to Rs 5,000 crore for refinance, enhancing its total available resources to Rs 17,000 crore. While most of this money will be disbursed to housing finance companies, a part will be used to settle previous dues.
“We are trying to serve the mandate and work on a very thin spread. We will pay our earlier borrowings through this money,” Verma said.
NHB recorded a net profit of Rs 235 crore last year (July-June 2009) compared with Rs 196 crore in the year-ago period. It disbursed Rs 11,000 crore in the year, its highest ever, recording an increase of 22 per cent from the Rs 9,000 crore it had disbursed in the previous year. It aims to disburse Rs 11,000 crore this year. NHB mobilised Rs 500 crore through deposit schemes earlier this year.
Verma said housing finance companies had fully used the Rs 4,000-crore refinancing facility much before the closing date of March 31, 2010. RBI had opened the facility when housing finance companies were facing a liquidity crunch in the wake of the global slowdown.
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