National Housing Bank to spur home finance companies

The National Housing Bank (NHB) is looking forward to relaxations in external commercial borrowing norms for spurring housing finance companies, NHB Chairman and Managing Director RV Verma said. NHB is expecting to modify some of the features (with regard to ECBs), which are a little restrictive now, he added.

This is being considered by RBI and the government to allow more players, he added. The RBI has already sent its recommendations to the government which are being considered on share capital and networth of HFCs, Verma said.

The existing norms with regard to Rs 50 crore of paid-up capital and Rs 300 crore of net-owned funds (NOFs) are being examined to allow more players in the ECB fold, he said. The RBI had allowed real estate developers, developing low-cost housing, and housing finance companies to raise up to $1 billion through ECBs last fiscal. He also pointed out that the ECB limit for FY'14 would be determined after exhausting the limit for FY'13.

The NHB has also sought some clarifications from the Finance Ministry regarding tax exemption in securitisation deals.