HBFC Signed Legal Documents Of Pkr 1.5 Bn Sukkuk
House Building Finance Corporation Limited (“HBFCL”) today signed the transaction legal documents of its PKR 1.5 billion (first tranche) Sukuk Issue. A signing ceremony was held at Finance & Trade Centre, Auditorium, to mark the event. The Sukuk has been subscribed by a diverse investors based comprising of Institutions including NBFC’s Islamic Commercial Banks, Islamic Mutual Funds, Takaful Company, etc. HBFCL’s Sukuk is the first mortgaged based Sukuk issue in the country.
Speaking on this occasion, the Managing Director, HBFCL apprised the investors that the funds raised through the Sukuk Issue will be utilized for business expansion in terms of the Business growth Plan prepared by IFC - appointed consultants, CMHC, Canada under technical assistance program of IFC. The business plan envisages an aggressive but prudent lending by HBFC over a period of next 5 years thereby increasing the annual disbursement from the current 3.5 billion to about 20 billion in 2012. HBFCL’s first Shariah Compliant Sukuk Issue is being hailed as a landmark achievement in the development of housing finance sector in Pakistan. As per said Business plan which principally stands approved by the Ministry of Finance. HBFCL is targeting to disburse Rs.8 billion during the year 2008,
HBFCL’s Sukuk Issue offers attractive return to its investors with a 1% spread over the base rate of 6-months KIBOR. Rentals will be payable on semi-annual basis and the Musharaka Units will be re-purchased by HBFCL in equal installments starting from the 18th month. PACRA has awarded A + rating to the Sukuk Issue.
HBFC was established in 1952 under the HBFC Act, to provide financial facilities for the construction, re-construction, repair and purchase of houses, particularly to the low and middle-income groups of the economy. It has so far financial around four lakh houses for Rs.45 billion. The Government of Pakistan and the State Bank of Pakistan jointly hold the share capital of the Corporation. In July 2007, it has been Corporatized and incorporated as a public limited company. HBFCL has a large network of 60 branches with 34 Representative offices spanning across the country, managed through 3 Regional Directors and 12 zones with headquarters at Karachi. The HBFCL employs more than 1400 personnel. Unlike other financial institutions engaged in housing finance, the bulk of the loan disbursements of HBFCL are to low income group, and for construction of houses, as against outright purchase and renovation. Under its new mission, the HBFCL aims to be the housing bank for Small & Medium Housing (SMH) finance. |
