Experts outline positive measures for Nigeria’s mortgage market

Although mortgage market and financing has continued to be a source of worry for operators in the nation’s housing delivery, investors and industry players have projected a positive future.
Currently, Nigeria’s mortgage banks charge between 19 and 24 per cent. And this could go higher, depending on the risk volume, which has affected the real estate’s potential as a goldmine for investors.

This has also affected the coverage rate which has unfortunately remained at a dismal 25 per cent and reduced its contribution to the national Gross Domestic Product (GDP).

But experts, who gathered at the ninth Annual General Meeting (AGM) of Trust Bond Mortgage bank Plc identified possibilities for a turn around in the next financial year.

The growth, according to them is attributable to the relative stability experienced in the last quarter of 2017, improved macroeconomics, improving business trajectory and nation’s economic growth.

Speaking at the event, Chairman, TrustBond Mortgage Bank Plc, Mr. Etigwe Uwa said with the government’s renewed interest in prioritizing affordable housing, particularly for low-income earners, improvement in currency market condition, oil output level and prices, moderating inflation rate and strengthened investors confidence; the potentials in the mortgage market would continue to increase..

He assured that with a gross earning of over N1.6 billion for the year ended December 31, 2017, the bank would continue to seek and implement systems and processes to enhance efficient service delivery, achieve cost optimization and strengthen risk management system.

Uwa, who noted that the contribution of the mortgage sector to the nation’s Gross Domestic Product (GDP) was dismally low (1per cent) considering the prospects in the industry, said government through interventions, programmes and policies is determined to increase mortgage finance and promote homeownership in Nigeria.

Managing Director of the bank, Mr. Adeniyi Akinlusi said the bank has in order to overcome the prevailing economic headwinds in the marketplace, put in place far-reaching measures to rein in costs and boost revenue with business restructuring adoption of new working strategies

He listed some challenges that hunted the industry in the year to include, negative GDP growth caused by the nations oil sector; weak consumer demand, high-interest environment, conflict in some parts of the country as well as uninspiring performance of the non oil sector.

Akinlusi further assured that the 2O18 financial year would be better as the company would place greater emphasis on growing the mortgage business volume while impacting positively in its immediate environment by working with other stakeholders to improve home ownership in the country.

He said the bank, which won the Mortgage bank of the year, most supportive bank of the year, best contributing employer in human resources development and outstanding contribution to home ownership in one financial would definitely give more to investors in the next year.

He further assured that the bank has taken pre-emptive action to reshape its credit portfolio and increase the frequency of risk monitoring and integrated stress testing for all the risks it undertakes.

This he noted would not only immunise the mortgage bank from the effects of cyclical downturn in its core market but significantly mitigate impacts and reposition the company for greater turnover.

One of the shareholders, Mr. Williams Adebayo who said the bank must stand erect and properly, commended the bank despite the economic challenges that faced the year. He, however, urged the bank to endeavor to reduce more of its operating cost.

At the AGM, two non-executive directors, Dr. Emmanuel Tayo Alabi, and Mr. Tamuno Atekebo were re-elected as stipulated by the company’s article of Association.

Credit: Guardian