FMBN targets 15% mortgage contribution to GDP by 2020
By Yinka Kolawole
Federal Mortgage Bank of Nigeria (FMBN) is targeting a minimum contribution of 15 percent to the nation’s Gross Domestic Product (GDP) by the mortgage sector by the year 2020, in line with government’s Vision 20-2020 agenda, declaring also that N56 trillion is required to tackle the housing deficit in the country.
Analysts however see the attainment of the target within the next 10 years as a tall order, against the backdrop that the sector presently contributes just about 1.8 percent to GDP.
Chairman of FMBN, Alh. Deda Atta, made the remark during a courtesy call on the Minister of Lands, Housing and Urban Development, Ms. Ama Pepple, in Abuja. He commended the federal government on the promise to recapitalise FMBN to the tune of N250 billion, noting however that about N56 trillion is needed to adequately address the huge housing deficit facing the country currently estimated to be 16 million units.
Nigeria needs development of mass housing such these
Atta asserted that apex mortgage bank is planning to build 500 housing units in each of the 36 states across the federation within the next twelve months, noting that the current N5 billion capital base of the bank is insignificant in relation to the present requirement of housing provision in the country.
“If we have a base of N250 billion which government has pledged to recapitalise the bank with, that will create a foundation that will enable FMBN to now access the capital market in the future for subsequent fund raising without falling back on government.”
To achieve what we can, we have set target for ourselves in line with federal government vision; we are looking at a minimum of 500 units of housing in each state of the federation in the next twelve months. We hope that this target can be reviewed upwardly if we are able to achieve this.
“FMBN is facing a lot of challenges, primary of this is the need to diversify our funding source, our capital base is less than N5 billion, this is totally the poorest and the least funded institution of this type probably in the world, South Africa, smaller countries than Nigeria have better capitalized mortgage operator.
In line with the vision of this government to recapitalize the bank to the tune of at least N250 billion, we are soliciting your (Minister) maximum support, with your wherewithal and with your antecedent in government we believe you have a quick role to play in pressing the right button to see to the actualization of this pronouncement which the government has already made, the Vice President, Alhaji Namadi Sambo made this announcement about two months ago and we will be relying on your support to get this actualized,” he stated.
Atta also called for the amendment or outright repeal of some of the laws currently regulating the housing sector so as to be able to attract foreign investment, and appealed to the minister to help see through the passage of the bills before the National Assembly.
“We need to get the obsolete bills which we know you are already aware of amended or even out rightly repealed by the National Assembly, we have been at it in the past two three years, but with your coming on board we are sure you will help us to get these bills amended in the National Assembly”.
