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NHB plans to tap more global funding agencies next fiscal

Sarbajeet K. Sen

G. Rambabu

NEW DELHI, Jan. 18

NATIONAL Housing Bank (NHB), which recently got a $50-million loan from the Asian Development Bank (ADB), proposes to tap other international funding agencies during fiscal 2000-01 to meet its funds requirement.

Among the other multilateral lending agencies with which the apex housing bank proposes to discuss the possibility of availing similar loans are Kreditanstalt Fur Wiederanfbau (KFW), Germany, the Overseas Economic Cooperation Fund (OECF), Japan, and the United States Agency for International Development (USAID). ADB would also be tapped for assistance in the next fiscal.

The NHB Chairman and Managing Director, Mr. P. P. Vora, told Business Line that the loan from ADB, which was finalised in December 1999, has been contracted for a period of 23 years at a coupon rate of 40 basis points over the six months LIBOR.

The apex bank has raised Rs. 150 crores through tax-free bonds, besides Rs. 300 crores from a recent taxable bonds issue. The taxable bonds issue, which closed on January 10, aimed at raising Rs. 150 crores, with a green-shoe option of another Rs. 150 cr ores.

The bonds, which carry a coupon rate of 11.70 per cent payable annually, have a maturity of eight years, with part-redemption facility available at the end of the sixth and the seventh years.

Mr. Vora said NHB plans to focus on its direct lending activities in the coming months. He disclosed that December 1999 saw the highest ever disbursement for direct lending.

Among the direct loans given, the largest consisted of a Rs. 100-crore loan to the New Calcutta Township being developed by the West Bengal Housing and Infrastructure Development Corporation Ltd (WBHIDCO).

The township project at Rajarhat, Calcutta, is being developed over 3,075 hectares and is estimated to provide housing facilities for a population of about one million.

The Rs. 100-crore loan to WBHIDCO is part of a Rs. 142-crore assistance being sought for the project by the NHB and the Housing and Urban Development Corporation (HUDCO) for the initial phase of land acquisition and infrastructure development.

The apex housing bank has also provided Rs. 17.5 crores to the Ahmedabad Municipal Corporation for the construction of 5,000 houses for the economically weaker sections, while another Rs. 49 crores has been extended to the Himachal Pradesh Housing Corpor ation for the construction of high-income group (HIG) flats at Solan.

Mr. Vora said with an aggressive approach towards direct lending, NHB is expected to exceed its business target of Rs. 966 crores for the current fiscal. ``We expect to complete this year with business of over Rs. 1,000 crores, which would be the highest in NHB's history,'' he said.