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Kenya: Mortgage Lender to Offer 30,000 Units
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The Nation (Nairobi)
16 May 2008
Posted to the web 16 May 2008
Joseph Bonyo
Nairobi
Mortgage lender, Housing Finance, has entered into the property supply market as part of the key to its five-year strategic growth plan.
The plan, to be carried out under the 'Housing Finance Charter for Affordable Housing', is expected to supply at least 30,000 housing units every year.
The units are expected to cover about 20 per cent of the government's intention of supplying 150,000 houses every year.
According to Mr Frank Ireri, Housing Finance managing director, the plan has already attracted a number of strategic partners.
"We have the right team and the right infrastructure in place needed to achieve this goal. It is a long term process that we are confident we shall achieve," said Mr Ireri on Thursday.
The mortgage financier will also be seeking to set up property in satellite towns as well as establish a commercial centre in Komarock area in the Eastlands part of Nairobi. Its development arm, Kenya Building Society, will carry out the developments.
Mr Ireri was addressing investors' at a Nairobi hotel when he launched its rights issue that the company hopes will raise Sh2.3 billion as additional capital.
The success of the venture, according to Mr Ireri, would see the firm increase its deposit takings to Sh30 billion while its lending ability would be scaled up to Sh30 billion.
"This would make us increase our lending ability by almost four times what it is currently as well as give us the opportunity to invest in our development company," said Mr Ireri.
Currently, market regulations do not allow an institution to provide lending of more than 25 per cent of its core capital.
The 115 million ordinary issues will be sold at Sh20 for existing shareholders. The rights, to be allocated in the ratio of one to one, will begin trading on May 30.
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The Government of Kenya, a 7.32 per cent shareholder in equity and one of the founding partners of the company will, however, not be participating.
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