By Accommodation Times News Services
HDFC India’s largest home finance company is promoting affordable housing through the Reserve Bank of India’s (RBI) special external commercial borrowing (ECB), facilitating for financing low-cost affordable housing. They have raised $300 million for a five-year tenor, from a consortium of four lenders, State Bank of India (SBI), Sumitomo Mitsui Banking Corporation (SMBC), the Bank of Tokyo-Mitsubishi UFJ and DBS Bank Ltd.
HDFC is the first housing finance company to introduce this, under the low cost affordable housing scheme of RBI scheme, ECB which is in the form of a syndicated loan facility.
In December 2012, RBI had permitted HFCs to raise ECBs for financing prospective owners of low- cost affordable housing units costing Rs.30 lakh, with the loan amount capped at Rs25 lakhs and the carpet area not exceeding 60 square meters.
“RBI has prescribed an aggregate limit of $1 billion each for FY14 & FY15 for ECBs to be drawn under this window,” HDFC said.
HDFC will pay 1.75% over the London Interbank Offer Rate (Libor) for the loan and will further conduct roadshows abroad to syndicate the loan.
The bank said, “HDFC has swapped the facility in Indian rupees for the entire tenor of the loan. Roadshows shall be conducted by the lender banks in Taipei & Singapore in March 2014 to syndicate the facility and invite other international banks to participate in the facility.”