The Federal Mortgage Bank of Nigeria (FMBN) has expanded its housing loan portfolio to include operators in the informal sector who now get micro-housing loans to carry out sundry housing projects.
The apex mortgage institution, whose traditional function is mortgage financing, has also brought into its financing net housing construction, and more recently rent-to-own product which allows a renter to live in a house, pay rent over a specified period and become the owner of the property.
Shehu Osidi, the bank’s managing director, who disclosed this recently in Abuja, noted that with the rapidly changing landscape and growing need for affordable housing financing, FMBN’s clientele base has widened from solely primary mortgage banks to private and public real estate developers.
“Our clientele also includes housing cooperatives and individual NHF contributors for home self-construction. The latest additions to our loan products are the Home Improvement and Rent Assistance loans, which are micro-housing loans specifically intended for, but not exclusive to, the non-salaried informal sector,” Osidi added.
He spoke at this year’s edition of Africa International Housing Show (AIHS) which had as its theme, ‘Financing the housing we need’, where he delivered a keynote address titled ‘New Dawn at FMBN.’
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Osidi noted that the housing situation in Nigeria is dire, quoting Vice President Kashim Shettima, as estimating, in September last year, Nigeria’s housing finance gap at N21 trillion while a 2018 PwC survey revealed that over 75 percent of the nation’s housing stock of 42 million units fails to meet UN Habitat standards.
The report, he added, further estimates the value of ‘dead capital’, that is, unrealised earnings from housing assets with limited earning capabilities, at about US$300 billion, translating to 60 percent of national GDP.
The managing director said regardless of these national challenges, FMBN has consistently served the needs of the Nigerian populace within the limits of its resources, pointing out that, since its re-establishment in 1993, the bank has delivered about 39,000 new homes, about 25,500 mortgages and over 120,000 micro-housing loans, all within a single-digit interest rate lending regime.
“Under the National Housing Fund (NHF) Scheme, it has registered 26,350 organisations and over 5.8 million cumulative contributors with over one million accounting for the self-employed sector. The Bank has disbursed the cumulative of N440 billion under its various loan windows to drive affordable housing finance for the Nigerian economy,” he said, adding, “To its record, the sum of N84.8 billion has been refunded to 492,604 contributors who exited the scheme in line with the provisions of the NHF Act.”
Osidi assured of the desire of the current executive management of the bank to transform it into an institution that delivers on its promises and is responsive to the yearnings and aspirations of its stakeholders – shareholders, contributors, loan beneficiaries, regulators, partners as well as staff.
“Accordingly, after careful and critical examination of the Bank and where it needs to be in the nearest future, the new executive management unveiled a seven-point agenda on assumption of office in February this year,” he said.
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