LIC Housing Finance looks at securitisation of Rs.5,000 crore loan

Chennai, Sep 12 (IANS) LIC Housing Finance Ltd is looking at the securitisation of around Rs.4,000-Rs.5,000 crore of its loan book this year and also e-auctioning of its non-performing assets (NPA), a top company official said.

“This year we are looking at the possibility of securitising around Rs.4,000-Rs.5,000 crore of our loan book. We have to look at the tax angle and stamp duties payable,” Sunita Sharma, managing director and CEO told reporters here on Saturday.

Simply put securitisation of loan is selling the loan portfolio to a buyer for a consideration. The loan book that thus sold will not figure in the balance sheet of the seller.

She was here to inaugurate the 18th edition of ‘Ungal Illam’ a property fair where around 70 builders are showcasing their different residential projects.

Queried about e-auctioning of the assets recovered for non payment of dues Sharma said the company is looking at it seriously.

She said the company had put on e-auctioning mode 14 of the distressed assets with a total value of less than Rs.2 crore, but did not get much response.

According to her, bulk of the company’s loans are under the retail or individual segment and the NPA at the end of last fiscal was only 0.24 percent.

Sharma said the company is targeting a disbursal of Rs.38,000 crore this fiscal an increase of around Rs.8,000 crore over 2014-15.

She said the company is looking at the interest rate and would reduce the same when it is possible.

According to her LIC Housing Finance’s average cost of fund is around 9.34 percent.

“Our fund sources are mainly non-convertible debentures and public deposits and these do not come cheap,” she added.

LIC Housing Finance has raised Rs.23,000 crore debt out of Rs.43,000 crore planned for the year.

According to Sharma, the company is studying the business leads generated by its representative offices in Dubai and Kuwait based on which future expansion plans would be decided upon.

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