House Building Finance Corporation (HBFC) Monday signed the legal documents of its Rs 1.5 billion (first tranche) Sukuk issue. The Sukuk has been subscribed by a diverse investors base, comprising Institutions including NBFC's lslamic Commercial Bank, Islamic Mutual Funds and Takaful Company etc.
HBFCL's Sukuk is the first mortgage-based Sukuk issue in the country. Speaking on the occasion, Managing Director HBFCL apprised the investors that the funds raised through Sukuk issue will be utilised for business expansion in terms of Business Growth Plan prepared by IFC-appointed consultant, CMHC, Canada under IFC's technical assistance programme.
The business plan envisages an aggressive but prudent lending by HBFC over the next 5 years, thereby increasing the annual disbursement from current 3.5 billion to about 20 billion in 2012. HBFCL's First Shariah Compliant Sukuk Issue is being hailed as a landmark achievement in the development of housing finance sector in Pakistan.
HBFCL's Sukuk Issue offers attractive return to its investors with a 1 percent spread over the base rate of 6 months KIBOR. Rentals will be payable on semi-annual basis and the Musharaka Units will be re-purchased by HBFCL in equal instalments starting from 18th month. PACRA has awarded A+ rating to the Sukuk issue.
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