The capital-starved Bangladesh House Building Finance Corporation (BHBFC) will get Tk500 crore from the current fiscal year budget allocation for continuation of its housing loan programme across the country, official sources said.
“We have decided to provide a loan of Tk500 crore to Bangladesh House Building Finance Corporation in three installments,” Finance Minister AMA Muhith said yesterday.
The decision came at the meeting on refinancing of House Building Finance Corporation at the finance division auditorium.
Presided over by the finance minister, the meeting was, among others, attended by BHBFC Chair Shaikh Aminuddin Ahmed and Managing Director Md Nurul Alam Talukder.
Muhith said the state-run corporation will take up reform programme to enhance its client facilities along with turning the corporation into a new specialised bank.
“The House Building Finance Corporation will increase its loan interest to 13% from existing 12% in line with the private sector,” he said, adding that the interest rate on house building loan is lower in rural areas than that in urban areas.
A meeting source said the corporation failed to disburse any new housing loans over the last one year due to capital shortage and so it sought fund from the bank and financial institutions division several times.
According the proposal, it will provide loans from the new financing amount for the clients living outside of Dhaka and Chittagong metropolitan areas.
The loan amount will range from Tk45 lakh to Tk25 lakh in divisional cities and rural areas, according to the proposal.
From its Tk500-crore fund, 75% loan will be provided on easy terms while the rest will follow the market condition, revealed the proposal.
The state-run corporation has targeted the disbursement of Tk400 crore loan for 2015-16 fiscal year while in the same period it will provide Tk543.89 crore to the government exchequer as income tax and debenture expenditure.
It provides house-building loans in the capital Dhaka and Chittagong city at 12% interest rate while it is only 10% for other cities.
The primary source of BHBFC fund is the paid-up capital contributed by the government.
Its authorised capital is Tk110 crore, and during this fiscal year the total paid-up capital also stands at Tk110 crore.
The Finance Division provided the corporation with Tk300-crore loan in four installments during 2009 to 2013.
