By Samson Echenim

Thursday, 25 Nov 2010

The Federal Mortgage Bank of Nigeria said on Wednesday that it had approved a total of N112bn housing loan to real estate development companies, state housing corporations and individuals since it was established in 1992.

It said, out of the N112bn, about N66.4bn was approved for private property developers, under the Estate Development Loans Scheme of the National Housing Fund, to provide about 27,000 housing units for the people.

The remaining N45.6bn, according to the bank, was approved as mortgage loans to individuals and state housing corporations.

The Acting Managing Director/Chief Executive Officer, FMBN, Mr. Michael Nwogbo, disclosed these at an interactive session with the organised private sector and labour, aimed at reintegrating employees into the NHF scheme.

Nwogbo, who was represented by a senior executive of the bank, Mr. Dapo Fakeye, further explained that the NHF had become very effective in the last two years. He said the fund hit an accumulative sum of N60.9bn as at September, 2010.

According to him, out of the sum, N28.8bn was realised between January 2008 and September 2010, with N10.8bn accumulated in only 2009. “Since the last 18 years, N828.8m had been refunded to 48,159 contributors, who qualified for refund,” he said.

But the Vice-President, Nigeria Labour Congress, Mr. Issa Aremu, said FMBN’s performance was ridiculous and far below the expectations of Nigerians.

He noted that it was a shame for the bank to have woken up just two years ago, after “16 years of slumbering.”

Aremu also said the problem of housing in Nigeria was largely an issue of poor governance and lack of political will.

He said, “The fact that FMBN is still using the minimum monthly income of N3,000 and 2.5 per cent contribution shows that the bank is behind the present realities of the Nigerian economy.

“This is not an indication that the bank is serious or even current at all.”

The NHF Act No.3 of 1992, which established the scheme, says contributors must earn a minimum of N3,000 monthly income and must contribute 2.5 per cent of their monthly income to the scheme.

“NHF has reviewed its maximum mortgage loan, from N1.5m to N5m, and to N15m in January, 2010,” the FMBN boss said.

While the National Bureau of Statistics puts Nigeria’s housing deficit at between 12 million and 14 million housing units, the United Nations says the country needs about 17 million homes to bridge its housing gap.

Nwogbo said, using the minimum benchmark of 12 million housing deficits for instance, Nigeria would have to build about 720,000 homes, each year, for about 10 years to meet up.

He said, “About 90 per cent of homes in Nigeria are built by individuals, with household income, over a period of between two to 10 years. In a country where we have about 50 million people in the workforce, only 3.5 million are contributing to the NHF scheme.

“The above figure is not comparable to that of Singapore, where a similar scheme provides 90 per cent of the country’s housing need.”

 

Source: Punch