mortgage house

FG begins full commercialization of Federal Mortgage Bank

As part of ongoing reform in the Housing sector, the federal government (FG) has commenced a process that would see the repositioning of its owned Mortgage Bank (FMBN) as a profitable entity.

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Alex Okoh, director-general, Bureau of Public Enterprises (BPE), said efforts to reposition the bank are for optimum performance and to bridge the country’s huge housing deficit estimated at 22 million as at 2019.

Consequently, the BPE on Wednesday inaugurated an 8- member committee for the Full commercialisation and recapitalisation of the Bank.

The Joint Technical Committee (JTC) which has 60 days to conclude set task comprises four members each from the Bureau of Public Enterprises (BPE) and the Federal Mortgage Bank of Nigeria (FMBN).

The Committee is expected to among others things; conduct a diagnostic review of the Bank’s existing institutional framework, organisational structures and operational modality.

The committee would review and harmonise all existing policies, law and regulations governing mortgage banking in Nigeria in order to identify areas that would facilitate the implementation of full commercialization and recapitalization of the FMBN.

The Committee is also expected to harmonise and synchronize all the reform processes of the FMBN with the ongoing reform of the Housing sector; develop strategies on how to reform FMBN that would enable it to raise funds from the money and/or capital markets without government guarantees.

It would further undertake a review of the legal, institutional and operational frameworks of mortgage banking in a few African counties and other emerging economies with a view to learning from their key success factors (KSFs) that can be replicated.



CBN Mandates Banks To Enrol For Credit Risk Management In System

In pursuit of a, sound financial system in Nigeria, the Central Bank of Nigeria, CBN, has asked all Development Financial Institutions (DFMs), Micro Finance Banks MFBs, Primary Mortgage Banks (PMBs and other Financial companies to enrol for the Credit Risk Management (CRMS).

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The apex bank said the redesign CRMS would help improve the Credit Risk Management of the financial sector, thereby promoting safe and sound financial system in the country.

In a circular, FPRD/DIR/PUB/CIR/01/002, dated April 8th and released on Monday by Kelvin N. Amugo, Director Financial Policy and Regulation Department, the CBN Mandated all DFIs, MFBs, PMBs, FCs are required to report all credit facilities (principals and interest) to the CRMS and to update same on monthly basis.

“As part of its effort to promote a safe and sound financial system in Nigeria, the Central Bank of Nigeria (CBN) introduced the CRMS to improve Credit Risk Management in commercial, merchant, non- Interest banks as well as to prevent predatory borrowers from undermining the banking system.

With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrolment of other financial institutions (OFIS) on the CRMS platform.”

The regulator also stated that Bank verification Number (BVN) and TAX identification Number (TIN) would be needed to undertake the CRMS process.

“Accordingly, all DFIs, MFBs, PMBs, FCs are required to report all credit facilities (principals and interest) to the CRMS and to update same on monthly basis. OFIs shall note that Bank verification Number (BVN) and TAX identification Number (TIN) are the only basis for regulatory renditions.

“To ensure full compliance,  OFIs are reminded to conclude the tagging of all live credit files for all individual and non individual borrowers with BVN and TIN respectively by May 14, 2021.

According to CBN, Other financial institutions should avail themselves with regulatory guidelines, adding that stiff penalties await those who fail to comply with the directives

“Furthermore, the concern  OFIs are advised to acquaint themselves with the regulatory guidelines for the operation of the redesigned CRMS for commercial, merchant and non- interest Banks in Nigeria(February 2017) and the additional regulatory guidelines of separation 2017.