Nasidi Adamu Yahaya
18 June 2008
Abuja — The Federal Mortgage Bank of Nigeria [FMBN], will provide an equity based loan scheme to provide secondary infrastructure in order to cushion difficulties in accessing mortgage finance in the country, the Bank's Managing Director said in Abuja yesterday.
Mr Abdulsalam Y. Ahmed, who spoke at a two-day workshop on new options for financing infrastructure for mass housing delivery, said under the loan scheme,FMBN is prepared to fund 70% of the cost of such infrastructure subject to the limitations of financial resources available to it, as well as its policies and priorities.
According to him, loans are integrated into the National Housing Fund [NHF] estate loan granted to developers at an interest rate of 10% per annum with a tenor of 24 months.
He however noted that only private developers can access the infrastructure loan as housing corporations are better placed to provide infrastructures in estates developed by them with assistance from their owner governments.
Mr Ahmed who was represented by Yunusa Shu'aibu, stated that it was envisaged that the bank will also be able to lend part of the expected funds to be raised through its capital market operation to finance estate development with requisite [secondary] infrastructure provision, noting that "but private developers must improve their credit worthiness significantly to be able to access the funds."
He said: "Worthy of mention here is the bank's outstanding achievement in the N100 billion Bond issuance and the successful floating of series 1 of the N100 billion mortgage-backed bonds amounting to N26 billion in 2007".
He added that the provision of infrastructure is necessary in housing delivery, adding that infrastructure costs could account for about 30% of the cost of an estate development with attendant prohibitive effects on the price of a house.
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