11/14/2015 1 FINANCIER | FACILITATOR | INNOVATOR PRESENTATION TO SELECT COMMITTEE ON PUBLIC SERVICES...

04/20/23 1 FINANCIER | FACILITATOR | INNOVATOR

PRESENTATION TO SELECT COMMITTEE ON PUBLIC

SERVICES

28 JUNE 2011

PRESENTATION TO SELECT COMMITTEE ON PUBLIC

SERVICES

28 JUNE 2011

04/20/23 FINANCIER | FACILITATOR | INNOVATOR 2

CONTENTS

1. Mandate, Vision and Mission

2. Strategic Objectives

3. NHFC Human Settlements

Interventions

4. Developmental Impact - 2012

5. Strategic Plan Overview

6. Contribution to Outcome 8

7. Key Performance Indicators

8. Objectives linked to Provinces

9. Challenges faced in Provinces

10. Service Delivery, Job Creation,

Poverty Alleviation

11. Projects: Potential impact (units )

by Province

12. Commercial: Provincial footprint

through intermediaries

13. Funding

14. NHFC Projects Showcase


NHFC’s Mandate, Vision, Mission

To be the leader in development finance for the low to middle income housing market.

Providing innovative and affordable housing finance solutions to the low and middle income households.

The National Department of Housing established the National Housing Finance Corporation Limited (NHFC) as a Development Financial Institution (DFI) in 1996 with the principle mandate of broadening and deepening access to affordable housing finance for

the low to middle income households.

Expand housing finance activities, through the effective provision of housing finance solutions, thus enabling the low to middle income households to have choice of renting or

owning or incrementally building, to meet their housing needs.

Facilitate the increased and sustained lending by financial institutions to the affordable housing market.

Mobilise funding into the human settlement space, on a sustainable basis, in partnership with the broadest range of institutions.

Conduct the business activities of the NHFC in a manner that ensures the continued economic sustainability of the Corporation whilst promoting lasting social, ethical and

environmental development.

Stimulate the low to middle income housing sector, by providing robust, relevant and timely research and market analysis to practitioners and housing consumers.

Strategic Objectives


ST

RA

TE

GIC

OB

JEC

TIV

ES


NHFC Human Settlements Interventions

Developmental Impact - 2012


Housing opportunities created: 16,884

Beneficiaries Benefitting: 64,158

Funding impact : R776 million

Private funds leveraged R1,297 million

Jobs Created : 1,860

Empowerment (Women and Youth Entrepreneurship) : R100 million

Strategic Plan Overview


16

,884

18

,962

22,

526

2012 2013 2014

Housing Opportunities

R

776

m2012

R

894

m

2013

Disbursements

R30

6 m

R50

0 m

R50

0 m

2012 2013 2014

Funding Requirements

R

1,0

76 m

2014

Note: The above figures exclude the Mortgage Default Insurance (MDI) implementation

Contribution to Outcome 8


Other Government Priorities


• Through funded projects, NHFC enables job creation, skills development and

entrepreneurship enabling Government to achieve the goal of economic growth.

The Corporation has included job creation as a KPI.

• Disbursements totaling R415 targeted towards women and youth managed /

owned companies in the planning period.

• The Corporation’s experiential programme (learnership for students, internship for

new graduates and sponsorship for students who are still at university –both

undergraduate and post graduate) is targeted at providing youth with work

experience as well as ensuring that those who are within the NHFC’s field of study

are assisted financially.

Key Performance Indicators


Objective 1: Expand housing finance activities, through the effective provision of housing finance solutions, thus enabling the low to middle income households to have choice of renting or owning or incrementally building, to meet their housing needs.

• Provision of loans to institutions that provide various housing tenure options –

Social Housing Institutions, Inner City Landlords and Integrated Housing Project

Developers.

• Provision of loans to intermediaries that on lend into the market for incremental

housing and home ownership.

• Syndication through dedicated Funds to scale up housing opportunities.

• Co-financing arrangements with Banks towards integrated settlements.

Key Performance Indicators (cont.)




Objective 2: Facilitate the increased and sustained lending by financial institutions to the affordable housing market.

• Syndication through dedicated funds to scale up housing opportunities.

• Co-financing arrangements with financial institutions towards integrated settlements.

• Through strategic partnerships attract other funders to fund intermediaries.



Objective 2: Facilitate the increased and sustained lending by financial institutions to the affordable housing market.

• Leverage ownership through Commercial banks through effective risk enhancements such as Mortgage Insurance(MI).

o The development of the MI implementation plan is advancing satisfactorily with the following milestones achieved to date:

o Business plan and financial modeling done.

o Positive engagement/consultations with Financial Institutions and Financial Service Board, BASA, Mortgage Originators and Developers, Shareholder, NCOP, National Treasury and the Presidency.

o A separate detailed Business plan on MI will be provided.



Objective 3: Mobilise funding into the human settlement space, on a sustainable

basis, in partnership with the broadest range of institutions• Source and mobilise funding in partnership with broad range of institutions to support

strategic objectives.

• Facilities concluded with AFD and EIB. Concurrent approval from National Treasury and Accounting Executive for both facilities.

• Sale of Retails books.

• Approval and implementation of optimum funding strategy and plan.

• Explore opportunities with DHS to mobilise funding into the Human Settlements space.



Objective 4: Conduct the business activities of the NHFC in a manner that ensures the continued economic sustainability of the Corporation whilst promoting lasting social, ethical and environmental development



Objective 5: Stimulate the low to middle income housing sector, by providing robust, relevant and timely research and market analysis to practitioners and housing consumers.

• Facilitate the provision of housing consumer education, skills development with

Partners and RFI’s.

• Provide an analysis of the affordable housing market performance, trends in house

prices, consumer behavior and patterns.

• Participate in the promotion and development of housing related policies, instruments

and strategies through providing input into DHS policy issues, legislations and

regulatory frameworks.

How Objectives are linked to Provinces


• Objectives are informed by both Provincial and National housing plans.

• NHFC provides top-up loan funding for most Social Housing initiatives by Province. An

amount of R300 million has been set aside for the current financial year for this

programme.

• The NHFC provides an implementation service to fast-track delivery of housing

projects. Examples are EC – Siyanda Project, KZN – All Social Housing projects.

• Currently working with all Provinces to develop in interim strategy for the roll out of the

Finance Linked Subsidies Programme (FLISP).

• We have dedicated funds to support inner city housing initiatives. The major focus is

currently in Gauteng, KZN and EC.

• We have a Development Fund to fund housing research initiatives in provinces that

must result in viable housing projects (Limpopo – Bendor, EC – Siyanda, KZN – First

Metro, WC – CTCHC).

Challenges faced in the Provinces


• Changes in political leadership tend to affect relationships and delivery of projects on

the ground.

• Long lead times for approval of projects under National Environmental Management

Act (NEMA).

• There is no effective and coordinated support by provinces to ensure the recovery of

monies owed by rental defaulters e.g. Polokwane, WC, Gauteng and KZN.

• Provinces are not honouring their payment undertaking to financial institutions for work

done by provincially appointed contractors, e.g. Illima (Gauteng).

• No demonstrable support for GAP housing initiatives. Provinces are not willing to set

aside funds for the FLISP Programme.

Service Delivery, Job creation and Poverty alleviation


• NHFC has set aside R1 billion for the current financial year for Human Settlements

initiatives (land, services and top structures)

• From our funding initiatives we expect to create 1 860 jobs.

• Most of our funding goes into construction wherein significant empowerment and skills

transfer takes place as most of the construction work is done by PDI sub-contractors.

• R100 million has been set aside for Youth and Women Empowerment initiatives.


Projects: Potential impact (units ) by Province 2012 - 2014


Commercial: Provincial footprint through intermediaries

Funding


• No additional capital from shareholder, funding raised externally

• External funding secured from AFD and EIB

• Sale of Retail books

• Approval and implementation of optimum funding strategy and plan.

NHFC Client Showcase


Southernwood Square: East LondonSouthernwood Square: East London

Emerald Sky: East LondonEmerald Sky: East London

HomeFront: RustenburgHomeFront: Rustenburg

Strathdon: Durban CBDStrathdon: Durban CBD

NHFC Client Showcase


Cavendish: Johannesburg CBDCavendish: Johannesburg CBD

Cavendish EntranceCavendish Entrance

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