FMDQ OTC Securities Exchange has signed a memorandum of understanding (MoU) with Nigeria Mortgage Refinance Company plc (NMRC) for intermediate long-term funds from the capital market towards the development of the mortgage industry.
This newest collaboration will help in bridging Nigeria’s housing deficit through the provision of affordable housing finance.
To mark this laudable feat, a signing ceremony, for the formal execution of the MoU, was held yesterday at the NMRC offices in Abuja. In attendance were Charles Inyangete, managing director/CEO, NMRC; Bola Onadele.Koko, managing director/CEO, FMDQ, and other key representatives from NMRC and FMDQ.
FMDQ, in partnership with NMRC and other key stakeholders, will engage in relevant initiatives and campaigns to educate the market on mortgage-related debt instruments such as Mortgage-Backed Securities, Real Estate Investment Trusts, among others, in readiness for the ensuing housing revolution which the Nigerian market is positioned to experience.
The World Bank estimated the cost of bridging Nigeria’s 17 million housing deficit at N59.5 trillion, a figure not too far from the estimation of the Federal Mortgage Bank of Nigeria which had put it at about N56 trillion.
Nigeria’s housing crisis is undoubtedly treading a path towards resolution, with institutions like NMRC, putting in place the necessary requisites for vibrant primary and secondary mortgage markets, and FMDQ, providing the necessary DCM support, collaboratively working towards the ultimate goal of developing the Nigerian economy.
This is coming on the heels of the Regulatory Supervision Collaboration Agreement, which the Exchange recently executed with the National Pension Commission, towards enhanced and efficient pension fund governance, regulation and supervision.
Speaking during the event, Inyangete commended FMDQ for its immense contribution to the development of the Nigerian debt capital market (DCM), and noted that the MOU executed with the Exchange demonstrates NMRC’s commitment to deepening the DCM.
According to Onadele, the need for effective cooperation and collaboration between FMDQ and NMRC cannot be over emphasised, as this partnership will mark an essential step towards the development of the Nigerian housing sector through, among others, the introduction and deployment of initiatives aimed at launching a range of mortgage products; the articulation of strategies aimed at developing the Nigerian mortgage industry through non-interest finance (e.g. Sukuk); partnership on awareness programmes, investor/market education and capacity building in Nigeria; and the expansion of listing opportunities for NMRC debt securities.
These initiatives are geared towards engendering market confidence and allowing NMRC to effectively connect the Nigerian mortgage industry to the DCM; and collaboration on pricing methodology, valuation framework and index development for mortgage bonds.
Iheanyi Nwachukwu
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