Gruh Finance Ltd, the Ahmedabad-based subsidiary of HDFC, plans to go in for a second round of sale of its housing loan portfolio of Rs 200-250 crore. This follows the success of round one when it downsized its balance sheet by Rs 200 crore by selling part of its portfolio.
Negotiations are on with HSBC, among other foreign banks, for selling the portfolio at a discount of 11-11.5 per cent, industry sources said.
Investment bankers said this route of selling assets will help Gruh churn its portfolio and, thus, achieve a higher turnover of assets. At the same time, it will help the company downsize its balance sheet and avail of total capital relief.
Gruh Finance is in need of funds as it plans to expand its retail operations to Karnataka, Madhya Pradesh and Goa. Its operations are currently confined to Maharashtra and Gujarat.
Gruh Finance notched up a turnover of Rs 80.11 crore during 2000-01, up from last year's figure of Rs 69.08 crore. Disbursements during the year stood at Rs 184 crore. The housing finance company registered a higher profit of Rs 6.04 crore, up 41 per cent from the previous year.
Foreign banks are looking at buying home loan portfolios as a part of their priority sector lending. As per Reserve Bank of India (RBI) norms, each bank has to maintain 3 per cent of their incremental advances in housing loans. Foreign banks view such loans positively since there is little chance of these becoming non-performing assets, said investment bankers.
