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655 mn subordinated loan from a Dutch financial institution to give its fledgling housing loan portfolio a leg up.
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Nations Trust Bank picked up a Rs. 655 mn subordinated loan from a Dutch financial institution to give its fledgling housing loan portfolio a leg up. The rupee denominated loan (equivalent to five million euros) is repayable over ten years with a five year grace period.
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The Dutch financier – Maatschappij voor Ontwikkelingslanden NV [FMO] based in the Hague – had already disbursed the first tranche worth Rs. 350 mn before the Christmas break last year.
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The balance is due within the first quarter of this year, and will also prop up Nations Trust Bank’s capital adequacy by about six percent, its CEO Zulfiqar Zavahir said adding that the bank's housing portfolio is over Rs. 350 mn at present.
NTB's deal is a first for a local commercial bank to tap foreign lenders for a loan without any government guarantee.
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"It is a reflection of the positioning of Nations Trust Bank in terms of its risk profile and our ability to work with overseas agencies which has lead to Nations Trust being considered favo