IFC lending up to $50M to PNB’s housing finance arm
Advertisement

IFC lending up to $50M to PNB’s housing finance arm

By Bhawna Gupta

  • 28 May 2014
IFC lending up to $50M to PNB’s housing finance arm

International Finance Corporation (IFC), the private sector lending arm of the World Bank, is lending up to $50 million to PNB Housing Finance Ltd (HFL), a housing subsidiary of Punjab National Bank (PNB), as per a disclosure by IFC.

This will be PNB HFL’s second debt raising in the foreign currency debt market.

PNB HFL is targeting an expansion of its housing finance portfolio and has obtained RBI approval for $100 external commercial borrowings (ECB). IFC plans to extend senior loan of up to $50 million on its own account.

Advertisement

The funding will support PNB HFL in increasing its reach in housing finance segments with additional focus on the low income states of India, women borrowers and for offering mortgage financing for green residential units.

Headquartered in New Delhi, PNB HFL was established in 1988 and was promoted by PNB, which currently holds majority shareholding. The balance is held by Destimony Enterprises Pvt Ltd which partnered with PNB in 2009 and is a wholly owned subsidiary of private equity fund New Silk Route.

The housing firm has 32 branches that focus on sales and customer service and three regional offices that oversee operations of underwriting and processing hubs. The company has expansion plans in tier II and tier III cities of the country.

Advertisement

IFC has been particularly bullish in the NBFC space and has previously backed other housing finance companies.

Last year it lent $85 million to Dewan Housing Finance Ltd (DHFL) to expand finance for affordable and energy-efficient housing in India. This followed an announcement early last year that it may lend up to $70 million to the housing finance firm besides additional commitment from the Canada Climate Change Program (CCCP) where IFC will act as an implementing entity for CCCP to support climate change investments.

In 2003, IFC lent around $12.5 million to the company and also co-invested in Aadhar Housing Finance, a company jointly promoted by DHFL Group and IFC, which provides affordable home loans to low income borrowers.

Advertisement

It has also backed housing finance unit of AU Financiers and last year lent money to the country’s top mortgage lender Housing Development Finance Corporation (HDFC).

Share article on

Advertisement
Advertisement
Google News Icon

Google News

Follow VCCircle on Google News for the latest updates on Business and Startup News