The Federal Mortgage Bank of Nigeria (FMBN) needs to be recapitalised to the tune of at least N100 billion in order to be able to effectively tackle the challenge of inadequate housing fund in the country.
Managing Director of the FMBN, Mr. Gimba Yau Kumo, stated this when members of the Association of Housing Corporation of Nigeria (AHCN) visited him recently, in Abuja. He declared that the present capital base of N2.5 billion is grossly inadequate to meet the mortgage finance needs of Nigerians.
Kumo asserted that lack of sufficient capital is seriously hampering the ability of the bank to deliver on its mandate to provide loans for housing development in the country. “Capitalization of FMBN will enable us have sufficient funds as loans to developers to build houses that are affordable for Nigerian masses. We should be looking at about N100 billion capitalisations, before we can fully say there is enough fund in the pool to offer as loans to contributors,” he said.
Represented by Mr. Mike Nwogbo, an Executive Director in the bank, Kumo argued that until the apex mortgage bank is recapitalised, the delivery of affordable houses to Nigerians would continue to be a pipe dream.
Worried by the huge housing deficit which, according to him, currently stands at over 16 million, he remarked that raising the capital base would enable the bank finance the implementation of government housing programmes. He however noted that the bank is exploring other sources of funding to enable it provide commercial loans to the public.
Kumo, who expressed worry over the huge housing deficit, which currently stands at over 16 million, said that if the capital base of the bank was raised to N100 billion, it would enable it finance the implementation of government housing programmes.
He noted that the bank is exploring other sources of funding to enable it provide commercial loans to the public.
The FMBN boss admitted that there are other challenges facing housing development, such as unavailability of land titles in the country, noting that solving the problems relating to the Land use Act will mitigate the challenges of housing delivery. “We are working hard with respect to housing delivery to Nigerians. The National Assembly had considered the issue of Land Use Act as constitutional issue.”
He added that the bank has created a department that would enable people in the informal sector have access to mortgage facility.