ISLAMABAD, July 24: The International Finance Commission (IFC) on Tuesday signed an agreement with the State Bank of Pakistan to launch a housing finance training programme in Pakistan.

The programme will help improve the housing finance market by enhancing the knowledge and skills of practitioners and it will be implemented by IFC Advisory Services for the Middle East and North Africa.

The training, which is expected to start from next month, is part of IFC’s efforts to develop the housing finance market for middle to low-income people.

It will cover all aspects from product development, loan marketing, distribution and origination to loan underwriting, servicing and risk management. The training is geared towards staff of banks and non-bank financial institutions that are providing housing finance or intend to do in the future.

The housing sector is a priority for the State Bank of Pakistan. It recently established a department dedicated to infrastructure and housing finance. The bank has also removed the 10pc cap, of total advances, on mortgage lending for commercial banks.

The outstanding mortgage debt in the country has grown nearly threefold in the last three years to about Rs70 billion which is one of the lowest penetration rates in the Middle East and North Africa.

“Thanks to IFC and the international trainers, we will be able to train lenders, provide them with best practices in the field of housing finance and ensure that the training material is tailored to the Pakistani market,” said Azhar Kureshi, Executive Director of the State Bank of Pakistan.

“The lack of mortgage origination and underwriting expertise in Pakistan and the scarcity of credible information and legal infrastructure are preventing housing finance from expanding and benefiting the lower-income market segments,” IFC Manager for the programme Syed Farhan Fasihuddin said.

This training was expected to help build the capacity of mortgage lending institutions to provide more housing finance loans and operate more efficiently, he added.

As part of its advisory services in the housing finance sector, the IFC has been working with the HBFC to develop a sustainable business plan for its operations.

—APP