LIC Housing Finance plans to disburse 10% of total loan to developers
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LIC Housing Finance, a subsidiary of Life Insurance Corporation of India (LIC) plans to disburse around 8-10 per cent of its total loan portfolio to developers by the end of this fiscal, a top company official said.
"Presently, around 6 per cent of our total loan portfolio constitutes of developer loan. We plan to increase it to 8-10 per cent in the current financial year," Director and Chief Executive Officer of LIC Housing Finance V K Sharma said.
He, however, said the housing finance firm would not aggressively push this portfolio in this fiscal though there is an uptick in the loan disbursements to developers.
By the end of June quarter, LIC HF's outstanding loan portfolio was at around Rs 65,650 crore, which was a 24 per cent growth over the same period last year.
While individual loans constituted 94-95 per cent of the portfolio, developer loans comprised 5-6 per cent of the total amount.
Earlier, the housing finance company had said low developer loan portfolio had put margins under pressure and higher disbursals would increase the margin level.
Sharma also said respite in interest rate is necessary to boost the overall housing finance industry and to reduce the cost of borrowing for the housing finance companies.
Talking about the overall growth projection, he said," Overall growth in loan portfolio is likely to be around 20 per cent in the current financial year," he said.
He also said there is no concern on the asset quality of the NBFC.
"There is no concern on the asset quality front. We have a total NPA of only around Rs 400 crore," he said.
Sharma, however, said the real estate sector was not growing in the country with subdued activity in metro centres like Mumbai, Hyderabad and Bangalore.
"Growth is pretty subdued in the metro centres like Mumbai, Bangalore and Hyderabad. However, there is a demand in tier-II and tier-III cities," he said.
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