MORTGAGE sector has got a fresh boost, with giant company, International Finance Corporation (IFC) investing up to 5.7 million US dollars (over 13bn/-) in the Tanzania Mortgage Refinance (TMRC).
The investment will, among other benefits, increase capital base of the TMRC and thus enable more access of mortgage loans to people through banks.
The two parts, the TMRC and the IFC announced their partnership in Dar es Salaam on Tuesday.
The TMRC Chief Executive Officer (CEO), Oscar Mgaya said, “Today we bring in a strong partner in the market, the IFC that becomes fourth largest investor in the TMRC.”
The IFC has invested in both equity and corporate bonds of the TMRC.
The financing includes the local currency equivalent of up to 1.5 million US dollars in equity and 4.25 million US dollars for a MediumTerm Notes (MTN) bond issuance, spread over multiple tranches.
“For the IFC to invest in TMRC it will increase confidence to investors of the corporate bonds and increase lending capacity of the TMRC,” he assured.
Board chairman of the TMRC, Mr Charles Itembe, said it was the first time for the TMRC to witness a giant investing in it.
“If the IFC has done a due diligence before investing, some have every reason to invite other local and international investors to invest in TMRC,” Mr Itembe stated.
He added: “We therefore expect that the future is bright in TMRC by both bonds and equity.”
He encouraged the local banks to organise themselves and acquire mortgage funds from the TMRC for distributing to people seeking mortgage loans.
On his part, IFC Resident Representative for Tanzania, Mr Frank Ajilore, noted that the relationship between the TMRC and the IFC started since 2010.
He said the IFC has this time become fourth largest investor in the TMRC in order to increase housing needs in Tanzania and reduce costs of loans and increase access to mortgage loans.
Commenting, Director of Research and Policy in the Bank of Tanzania (BoT), Dr Suleiman Misango, commended the partnership, saying it was beneficial for housing development in the country and economy at large.