Indiabulls Housing: Indiabulls Housing soars 9% on entering strategic partnership with HDFC
HDFC is the market leader in the housing finance industry with assets under management of Rs 5,52,167 crore.
As per the agreement, Indiabulls Housing will originate retail home loans as per jointly drawn up credit policy and retain 20 per cent of the loan in it’s books and 80 per cent will be on HDFC books. Indiabulls Housing will service the loan account throughout the life cycle of the loan.
Following the development, the scrip rose 9.20 per cent to hit a high of Rs 180.30 on BSE.
“Co-lending partnership with HDFC Ltd will act as a cornerstone to Indiabulls Housing’s new balance-sheet light growth business model. Moreover, technology led co-lending will help the company offer convenient and seamless experience to its customers as well as help expand its reach to Tier III and IV towns of the country,” Indiabulls said in a filing.
In a filing, HDFC said that 20 per cent of the credit risk by way of direct exposure would be on the Indiabulls’ book till the time the loan is repaid and Indiabulls Housing will not assign its portion of the loan to any third party. Hence, Indiabulls Housing will be invested in the arrangement through the life of the loan.
“HDFC will continue to have oversight on the programme post approval of loans, through the disbursement stage, as well as the post disbursement stage through the life of the loan,” it said, adding that it will also be entitled to review and conduct audit of all the transactions carried out under the arrangement.
The HFC said all loans will be processed in accordance with the standard operating procedures (SOPs) and the loan eligibility criteria as specified by HDFC. The methodology will be the same as is done by HDFC while appraising its loans.
Post the initial appraisal the loans will be approved by a senior official of HDFC and accordingly credit will be controlled by HDFC, it said.
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