•The mortgage finance company listed as HF Group hoped to prompt the market to issue mortgage-backed securities, using its mortgage loan book as the underlying assets.
•HF Group has said the bond aided the firm to bolster its loans and advances, which grew from Sh25billion to Sh44billion as at December 2018 while total assets grew from Sh31 billion to Sh57billion within the same period.
Housing Finance Limited has announced full repayment of a Sh3 billion corporate bond which was issued to investors in 2012, over increased liquidity from high housing supply.
The seven-year tenor bond which matured on October 14 was first listed on November 14, 2012 at the Nairobi Securities Exchange at a coupon of 13 per cent.
The bond was issued as public corporate debt to tap into long term funds from the market and investors for housing.
The mortgage finance company listed as HF Group hoped to prompt the market to issue mortgage-backed securities, using its mortgage loan book as the underlying assets.
“We are pleased to announce the full redemption of tranche II of the seven-year Medium Term Note and are satisfied with the returns generated for our investors," Group CEO Robert Kibaara said.
"Over the years, HF Group has continued to maintain its deep understanding of the market to sustain its consistent operational metrics while meeting its responsibility to investors which mirrors our robust corporate governance culture and a well-defined corporate strategy.''
The Capital Markets Authority approved the issue in 2010 and listing of a seven-year Sh10 billion bond.
Housing Finance raised Sh7 billion in the first tranche in October 2010, which represented an oversubscription of 41 per cent above the then target of Sh5 billion.
The firm then decided to take the entire Sh7 billion due to the high demand.
The offer for the second tranche of Housing Finance bond went on offer on 1st October at a fixed rate of 13 per cent.
HF Group has said the bond aided the firm to bolster its loans and advances, which grew from Sh25 billion to Sh44 billion as at December 2018 while total assets grew from Sh31 billion to Sh57 billion within the same period.
''The funds raised played a pivotal role in the growth of our full-service banking offering and specifically in financing the working capital and expansion of the bank's growing SME customer base, end buyer mortgage financing and asset financing,'' Kibaara added.
The retired bond also propelled the group's project financing of developers seeking to tap into the growing housing demand, the sales of which was accelerated after the launch of the Shika Nyumba Na HF campaign.
This as Kibaara noted, has helped create widespread awareness of the listed lender's projects and those it has financed.
''We have sold more houses in the last eight months than the previous two years combined, which boosted our liquidity and hence fully financing the bond repayment."
"Our mission is to improve the quality of life for individuals and communities both now and in the future, by providing better homes, amenities, retail and leisure spaces matched with security all within the sphere of affordable housing agenda,'' he said.