Mortgage firm boosts capacity, admits IFC and Shelter Afrique to its ranks
Wednesday, July 1st, 2020
Kenya Mortgage Refinance Company (KMRC) has admitted the International Finance Corporation (IFC) and Shelter Afrique to its ranks, giving the government entity additional muscle to offer long-term finance to mortgage companies.
The deal was approved by shareholders during their annual general meeting held yesterday IFC while Shelter Afrique is a pan-African housing and real estate development financier.
KMRC was established in 2018 as a Public Private Partnership vehicle to support President Uhuru Kenyatta’s Affordable Housing Pillar of the Big Four development blueprint.
It is expected to provide secure, long-term finance to primary mortgage lenders, who then advance the same to individual borrowers.
Johnstone Oltetia, acting chief executive said from an operational standpoint, he could confirm that everything is now in place for the company to start providing long-term finance to participating financial institutions, for onward lending to home loan borrowers at affordable rates once KMRC obtains a license.
Acting chairman Haron Sirima said the admission of IFC and Shelter Afrique to its board will enable KMRC revolutionise the home loans market, by making houses affordable “for as many of wananchi as possible.”
The admission comes after National Treasury and Planning Cabinet Secretary Ukur Yatani, in his budget statement said KMRC would be enabled to maintain adequate liquidity among primary mortgage lenders - banks and Sacco’s.
He said this was necessary in order to keep housing finance and the housing market functioning in the face of the Covid-19 pandemic.
“This will avert a potential credit crunch that would hurt lower income households and interrupt efforts to support affordable housing,” Yatani had said.
KMRC is mandated to address shortage of long-term finance in the financial market and the problem of asset maturity mismatch, which is responsible for the high cost and general inaccessibility of home loans .