LIC Housing Finance to float fin services arm
LIC Housing Finance (LICHFL), the country’s second-largest housing finance company, is all set to launch its financial services subsidiary, LIC Housing Finance Financial Services, but has deferred its venture capital fund in view of the market conditions.
“We have everything in place ranging from the required offices to the management staff. The company has already started functioning in a small way, but we will launch it officially in another month,” said LIC Housing Director and Chief Executive Officer R R Nair.
To start with, the company’s product suite would include home loans, insurance products and mutual funds and going forward it would add on credit cards and other third-party products.
“For home loans and insurance, we will distribute our in-house (LIC) products only. Whereas, mutual fund products of all companies will be available as we have already tied-up with the major players in the market,” Nair added.
Initially, there will be six offices across the major cities in the country and subsequently it will expand in the next financial year. The proposed venture capital fund, which was delayed due to the ongoing financial crisis, is expected to kick off in the first quarter of the next financial year.
The fund was incorporated last year and was aimed at investing in housing projects and new constructions.
“With realty prices falling all over and we expect this to continue over the next few months. So we are waiting for the appropriate time to start the fund. Now that the set of the financial services company is complete, we will concentrate on the venture capital fund,” Nair said.
LIC Housing Finance registered a 27 per cent growth in net profit to Rs 134.33 crore for the quarter ended December 31, 2008 as against Rs 106.62 crore in the year-ago quarter. The company said it is looking to disburse Rs 10,000 crore by the end of the current financial year. During 2007-08, the company’s total disbursement stood at Rs 7,071 crore.