Kolkata: National Housing Bank has on Monday announced the formation of India's first mortgage guarantee joint venture with three overseas partners -- International Finance Corporation, Asian Development Bank and US-based financial security firm Genworth Financial International Holdings.
NHB will have the majority stake with 38% holding while Genworth will hold 36%. IFC and ADB will hold 13% each the company -- the India Mortgage Guarantee Corporation Pvt Ltd. It proposes to start operation with a Rs 120 crore paid up capital once it gets licence from Reserve Bank of India.
"NHB has been part of this project through the years and we are glad that the company has been set up now, richer with all the learnings from the recent global experience," NHB chairman and managing director RV Verma was quoted saying in a press statement released Monday.
The JV will provide guarantees to credit portfolio of banks and housing finance companies. "Mortgage guarantee products will bring in greater depth and stability in the housing finance market," Verma said.
State Bank of India, Housing Finance Development Corporation or ICICI Bank are expected to benefit the most from this development as they can unlock significant chunk of their capital by taking mortgage guarantee cover and expand business further.
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