As wary banks tighten norms for the scam-scarred realty
sector, the government is planning to set up a fund for lenders that would act
as a guarantee corpus to lend for housing projects.
Banks can take recourse to the fund if realty companies
default on their loans. The modalities of the fund, which is likely to be
around Rs.1,000crore are still being worked out.National Housing Bank (NHB), the
state-owned housing refinance agency, will act as the nodal authority for the
working of the fund. Finance Minister Pranab Mukherjee is expected to make an
announcement on the fund in the budget for 2011-12.
"Housing sector needs to get a push, though banks have
developed a cautious approach in lending for housing especially in the wake of
the recent spate of events. The move would ease financing into the sector,"a
Government source that did not wish to be identified said.
Banks have become more "conservative" in extending
credit to the realty sector amid a slow of allegations about ineligible
companies receiving scarce telecom spectrum at arbitrary and throwaway prices.
The sector was also hit by allegations of siphoning of
funds raised through loans for housing projects. The real estate sector has an
estimated debt of about Rs.75,000crore of which Rs.25,000crore is coming up for
repayment in the current fiscal.
"The objective of the proposed fund is to put banks at
ease by offering a kind of guarantee that they can dip into this pool if loans
turn bad," said the source. Bankers said they have become more cautious in
lending to realty companies and would rather prefer lending funds to old economy
brick-mortar sectors such as steel, cement, textiles and manufacturing than to more
risk-prone real estate sector.
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