National Housing Bank raises cap on refinancing to Rs 300 billion

The National Housing Bank (NHB) on Monday enhanced the limit to refinance eligible housing finance institutions to Rs 300 billion for 2018-19 in the wake of the present liquidity position of the sector.

For the present financial year, between July 2018 and June 2019, the NHB had initially set the refinance target at Rs 240 million.

This refinancing is a “credit flow” to the housing finance companies facing liquidity crunch following a series of defaults by group of companies of IL&FS Ltd.

The NHB, a principal agency to promote and provide financial support to 97 housing finance institutions, had sanctioned Rs 88.35 billion till date. “Housing finance companies are secured assets in the Non-Banking Financial Company (NBFC) space. This move will provide some comfort to the eligible housing finance institutions. Though no regulator has so far talked about a liquidity crunch in this market but we have taken this step proactively,” said a senior government official.