Largest mortgage lender signs world’s largest $1.1 billion social loan
India’s leading mortgage lender, Housing Development Finance Corporation, said it had secured the world’s largest social loan, a $1.1 billion facility to finance affordable residences, highlighting the potential for sustainability-related finance.
The loan package was priced at a margin of 90 basis points over the guaranteed overnight funding rate.
MUFG Bank Ltd. was the lead social lending coordinator and also one of the lead arrangers and mandated borrowers along with CTBC Bank Co., Mizuho Bank Ltd., State Bank of India and Sumitomo Mitsui Banking Corp., according to a statement from HDFC.
“Affordable housing is an essential part of quality infrastructure, as well as an engine of growth for the real estate sector and the economy in general,” said Deepak Parekh, President of HDFC.
HDFC’s lending facility complies with international social lending frameworks that consistently certify, track and monitor the social impact of financing assets, the financier said.
Use of proceeds, objectives and transparency are among the main tenets of social lending, according to the Loan Market Association.
The line of credit and HDFC’s stated objective is in line with a fundamental commitment of Prime Minister Narendra Modi’s government, which has made “housing for all” a policy objective.
HDFC’s jumbo social loan will increase the volume of sustainability debt which has taken a hit this year as companies stepped back to focus on securing or saving cash amid rising inflation . Social loans are only a small part of the overall sustainable debt market.
–With the help of Jacqueline Poh.
(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)