India National Housing Banks to buy stake in Housing Corporations |
India`s Ministry of Finance has been taking concrete steps to help revive the ailing real-estate sector and give a further push to affordable housing where the government is placing a lot of thrust on. In this context, India`s Finance Minister Nirmala Sitharaman will soon announce a clutch of steps. The National Housing Bank, which until recently was the regulator for housing finance companies also called the HFCs, will be allowed to go beyond its current role as re-financier to HFCs and pick up equity stakes in some of them. This move would significantly enhance the liquidity-starved entities` ability to mobilise funds, including bank finance. Banks may also be nudged to relax their loan covenants with the real estate developers in order to facilitate faster clearance of the huge mass of inventories with the latter via deep discounts to homebuyers. The Cabinet in early August gave NHB approval to infuse an extra Rs 10,000 crore into eligible HFCs in its financial year through June 2020 to shore up their liquidity and boost flow of funds for affordable housing loans for individuals, over and above the support being given by NHB to HFCs through its two existing refinancing schemes.
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