U.S. corporation approves NMRC’s $200m loan for affordable mortgage

To address the liquidity gap in Nigeria’s finance market, Nigeria Mortgage Refinance Company Plc (NMRC) has received approval for $200 million in funding from the U.S. International Development Finance Corporation (DFC) for affordable mortgage financing.

According to the National Bureau of Statistics, 63 per cent of Nigerians are multi-dimensionally poor. Therefore, the financing is expected to provide vulnerable population segments with access to credit facilities, including Nigeria’s large informal sector, low-income earners, and women who face extreme difficulties in their bid to own a home.

The fund is part of a $228 million blended financing transaction arranged by MiDA Advisors and Stanbic IBTC Capital, a member of Standard Bank Group. The transaction will include a $200 million loan and $28 million in financing sourced from local financial markets.

Specifically, approximately 20 per cent of the loan will be allocated to informal and low-income borrowers, while an estimated 40 per cent of the mortgages to be refinanced or pre-financed will be those underwritten to women as borrowers or co-borrowers.

Nigeria Mortgage Refinance Company Plc (NMRC) partnered with U.S.-headquartered MiDA Advisors and Johannesburg-headquartered Standard Bank Group to co-create a blended finance solution to mobilise long-term financing at scale.

The transaction and strategic partnership with DFC will provide the needed liquidity to support the country’s quest to bridge the housing deficit while driving more equitable economic growth and development.

The facility will be disbursed through on-lending to primary lending institutions, such as commercial banks and primary mortgage banks, to refinance or pre-finance eligible mortgage loans to qualifying mortgage borrowers across the country.

Reacting to the approval of the loan, NMRC Managing Director, Mr Kehinde Ogundimu, expressed gratitude to DFC, noting that it is clear proof of NMRC’s positioning as a key institution within the housing ecosystem.

“This transaction will certainly enhance our efforts to provide affordable long-term housing finance in a manner that will impact the overall sector. It shows that DFC and, indeed, other local and international financing institutions have a lot of trust in our capacity to manage long-term facilities that will make a tangible impact on the lives of Nigerians.

“The keen focus on low-income earners, the informal sector, and women is indicative of the direction of our efforts. As an institution, we are committed to driving equitable access to housing credit facilities thus enabling vulnerable Nigerians to achieve their homeownership dreams,” he added.

MiDA Advisors Chief Executive Officer, Mr Aymeric Saha, said: “We are very pleased to partner with NMRC and Standard Bank to arrange another transformative housing finance solution that will impact over 6,000 households in Nigeria. Through this transaction, we are demonstrating again the power of partnerships with Africa’s leading companies such as NMRC to tackle social infrastructure financing needs in the region.”

The Chief Executive, Corporate and Investment Banking, Standard Bank Group, Mr Luvuyo Masinda, said the transaction demonstrates the bank’s commitment to driving Africa’s socio-economic development through the facilitation of sustainable investment on the continent.

“We understand the needs and challenges of Africa’s people and continue to deliver innovative solutions to address these. This is truly an incredible transaction with a positive impact to Nigeria and the continent.”

Commenting on the transaction, Chief Executive of Stanbic IBTC Capital Limited, Oladele Sotubo, acknowledged MiDA Advisors collaboration to facilitate this landmark financing aimed towards enhancing the accessibility and affordability of mortgages in the country.

“The objectives of the transaction are well within the Standard Bank Group’s purpose in driving Africa’s growth, and we are extremely proud to be party to the transaction,” he added.