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$300m credit: World Bank scores Nigeria’s housing finance low

The implementation progress of the Nigeria Housing Finance Programme (NHFP) towards achieving the Project Development Objectives ( PDO) has declined, latest World Bank rating on the project has said.

According to the latest rating by the global bank, the NHFP fell from satisfactory in January 2017 to moderately satisfactory in July 2017. The World Bank Board of Directors in 2013 had approved a $300 million International Development Association (IDA)’s credit to boost Nigeria’s efforts to provide affordable mortgages for middle-income and lower income families.

The NHFP is meant to directly benefit new home owners who struggle to find available cash to purchase a long-term mortgage and increase incomes for Nigerian families through the creation of new jobs. However, for full implementation of the programme, the Federal Government under the NHFP recently rose to the occasion by launching ‘My Own Home’ Scheme to enlighten those seeking to own houses of theirs across the country on how to key into the scheme and become beneficiaries.

Expressing concerns over the low rating of NHFP, Social Housing Activist and International Housing Finance Specialist, Mr. Adekunle Faleti, said: “This is indeed a very strong disapproval, in terms of IDA lingo.” He pointing out that in contrast, the Egyptian Housing Finance Programme has remained moderately satisfactory in both ratings for January and July 2017.

Faleti, on his facebook page, said that the programme “is failing” in Nigeria. However, he stated that it should be noted that the Nigeria Mortgage Refinance Company (NMRC) component of the project has remained very successful, largely due to the independence of the institution, its strong corporate governance and transparency of the board of directors.

“As a key stakeholder in Nigeria’s housing finance sector, I will confidently say that a single individual cannot and should not continue to hold the country to ransom.

The implementation progress of the Nigeria Housing Finance Programme (NHFP) towards achieving the Project Development Objectives ( PDO) has declined, latest World Bank rating on the project has said.

According to the latest rating by the global bank, the NHFP fell from satisfactory in January 2017 to moderately satisfactory in July 2017. The World Bank Board of Directors in 2013 had approved a $300 million International Development Association (IDA)’s credit to boost Nigeria’s efforts to provide affordable mortgages for middle-income and lower income families.

The NHFP is meant to directly benefit new home owners who struggle to find available cash to purchase a long-term mortgage and increase incomes for Nigerian families through the creation of new jobs. However, for full implementation of the programme, the Federal Government under the NHFP recently rose to the occasion by launching ‘My Own Home’ Scheme to enlighten those seeking to own houses of theirs across the country on how to key into the scheme and become beneficiaries.

Expressing concerns over the low rating of NHFP, Social Housing Activist and International Housing Finance Specialist, Mr. Adekunle Faleti, said: “This is indeed a very strong disapproval, in terms of IDA lingo.” He pointing out that in contrast, the Egyptian Housing Finance Programme has remained moderately satisfactory in both ratings for January and July 2017.

Faleti, on his facebook page, said that the programme “is failing” in Nigeria. However, he stated that it should be noted that the Nigeria Mortgage Refinance Company (NMRC) component of the project has remained very successful, largely due to the independence of the institution, its strong corporate governance and transparency of the board of directors.

“As a key stakeholder in Nigeria’s housing finance sector, I will confidently say that a single individual cannot and should not continue to hold the country to ransom.

The project is currently throbbed with nepotism, malfeasance and awesome abuse of power,” he said. Suggesting ways of improvement, he stated that while it was true that the implementation agency is the Central Bank of Nigeria (CBN), there must be honest, transparency and delegation of authority to achieve meaningful and measurable success. He said: “The consultants, specialists and CBN staff working on the project must be given a free hand to perform at their peak.

They should not continue to be micro-managed like kindergarten pupils.

“ A former Director of Nigeria Mortgage Refinance Company (NMRC) and Founder/Chairman, Dunn Loren Merrifield, Mr. Sonnie Ayere, said he believed that operators should be able to significantly up the mortgage numbers with the advent of Mortgage Warehouse Fund Limited (MWFL) going forward. On the implementation status and key decisions, the report noted that the NMRC, which was established in 2015, has made progress with 22 investors who have committed around $35 million in share equity.

According to the report, the overall private sector shareholders are in the majority with 60 per cent of the equity, noting that NMRC has made significant efforts to develop the housing finance market and developed in particular common underwriting standards. For full implementation of the programme, the CBN has selected 34 primary mortgage banks and four commercial banks to stimulate housing finance for low-income earners in the formal and informal sectors.

Source: https://newtelegraphonline.com/2018/02/300m-credit-world-bank-scores-nigerias-housing-finance-low/

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