A Briefer on NATIONAL HOME MORTGAGE FINANCE CORPORATION. 25 TH CREBA NATIONAL CONVENTION Baguio City October 13, 2016

Transcription

1 A Briefer on NATIONAL HOME MORTGAGE FINANCE CORPORATION 25 TH CREBA NATIONAL CONVENTION Baguio City October 13, 2016

2 Outline I. Mandate II. Programs A. Regular Programs B. Projects in the Pipeline

3 I. MANDATE

4 NHMFC Mandate PD No (December 21, 1977) Develop and provide for a secondary home mortgage market, charged with the development of a system that will attract private institutional funds into long-term housing mortgages

5 Role of NHMFC HOMEBUYERS PRIMARY MARKET SECONDARY MARKET: Capital Market Socialized Economic Low Cost HOUSING DEMAND Banks & Other Financial Institutions Housing Developers/ Originators MORTGAGES (HLRPP) MBS (Bahay Bonds) Investors (Institutional/ Retail) MORE HOUSES LIQUIDITY LIQUIDITY NHMFC links the housing sector and the capital market

6 NHMFC Securitization Cycle Originator Housing Loan Receivables Purchase Program (HLRPP) SEPARATION MULTIPLICATION Pool of Assets for Securitization Fresh Funds from the Issuance of Securities TRANSFORMATION

7 Key Success Factors for Securitization: FEL Framework (Pera-Piga-Paikot)

8 II. PROGRAMS

9 REGULAR PROGRAMS: BAHAY BONDS Securitization Program BahayBonds1 NHMFC maiden securitization issued in 2009 Worth P2.06B Offered to institutional investors Best Securitization awarded by the The Asset Asia Awards Maturity: 2017 BahayBonds2 First ever listed retail RMBS in the country issued in 2012 Worth P603M Offered to both institutional and retail investors Most Innovative Retail Issue of the Year awarded by PDS Maturity: 2017 (retail) / 2022 (institutional)

10 REGULAR PROGRAMS: HLRPP HLRPP 1 - Economic & Low Cost Housing Launched in 2010 Fixed interest rate in the entire duration of term (7-25 years) Low equity requirement Minimum 10% LTV Ratio - 90% Expanded Coverage: REM and CTS HLRPP 2: Socialized Housing Loan Takeout of Receivables (SHeLTeR) Approved in May 2016 Housing Loans of up to P450K Fixed interest rate Year 1-10 = 4.5% Year 11-end of term = 6.5% No equity requirement 100% LTV not exceeding P450K

11 Streamlining Procedures for HLRPP1: Turnaround time for provision of housing finance from receipt of complete documents Target Accomplishment Target Accomplishment 30 working days Average of 21 working days Average of 25 working days and not exceeding 30 working days Q1 19 working days Q2 11 working days

12 Programs/Projects in the Pipeline (1) BahayBonds 3 Third series of the Bahay Bonds Program ASEAN Commingled Bond Joint issuance with CAGAMAS (NHMFC s counterpart in Malaysia) and possibly SMC (Thailand)

13 Programs/Projects in the Pipeline (2) Islamic Housing Finance Provide home loan financing that is Sharia compliant Priority will be given to 5.8 million Muslim Filipinos* Vehicle to issue Sukuk (Islamic bonds) and funds from Islamic funds to enter the Philippines (through Mudarabah) Funds will be invested to projects related to housing Issue/Challenge Absence of legal and regulatory framework on Sukuk (DOF, SEC, BIR, BSP, BOI) *Estimated number of Filipino Muslims for the year Sources: psa.gov.ph; muslimmindanao.ph

14 Programs/Projects in the Pipeline (3) Reverse Mortgage Maginhawang Buhay dahil sa bahay (MABUHAY) Aims to help the senior citizens with limited current income but have substantial real estate properties (house and lot) to be used as collateral Additional financing window for senior citizens in support of RA No or the Expanded Senior Citizens Act of 2010.

15 NHMFC s Proposal: Establish a clear value chain among the housing agencies HUDCC HLURB Houses Mortgages HOME PRODUCERS HOME BUYERS SECURITIZATION NHA (and developers) HDMF(primary mortgage market) SHFC NHMFC (secondary mortgage market) Liquidity HGC Liquidity HOUSING SUPPLY = HOUSING DEMAND

16 THANK YOU FOR YOUR ATTENTION ROSABELLA C. JOSE VP, SECURITIZATION GROUP

17 GIVEN P270 BILLION INITIAL FUNDING, HOW LONG IT WILL WIPE OUT THE 5.5 MILLION HOUSING BACKLOG? SCENARIO 1 ONE TIME FUNDING SCENARIO 2 SCENARIO 3 HIGH LOW Utilization 100% 100% 70% 50% Extraction(CER) 95% 80% 50% 50% Reduction in Backlog-10yrs 38% 18% 3% 1.60% ANNUAL FUNDING HIGH LOW Utilization 100% 100% 70% 50% Extraction (CER) 95% 80% 50% 50% Reduction in Backlog -10yrs 233% 131% 26% 16.00% -5yrs 69% 47% ONE TIME AGENCY FUNDING + ANNUAL NG FUNDING HIGH LOW Utilization 100% 100% 70% 50% Extraction (CER) 95% 80% 50% 50% Reduction in Backlog -10yrs 75% 39% 7% 6.00% -5yrs 29% 20%

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