KMRC set to pay investors on February 28
KMRC was established to provide secure, long-term funding to Primary Mortgage Lenders (PMLs) such as banks, Saccos and other microfinance institutions
Kenya Mortgage Refinance Company (KMRC) has announced that it will issue the 3rd principle partial repayment and 6th interest payment is due on February 28.
The interest will be paid at a fixed rate of 12.5 per cent (on the amount of notes held) to the bondholders whose name(s) appear on the bondholders’ register at the close of business tomorrow (Friday).
KMRC is an initiative of the National Treasury and World Bank. It was formed in 2018 with the aim of supporting the affordable housing initiative that was part of the government’s Big Four Development Agenda during President Uhuru Kenyatta period.
KMRC was established to provide secure, long-term funding to Primary Mortgage Lenders (PMLs) such as banks, Saccos and other microfinance institutions within the country for onward lending to potential homeowners.
It raised funds in the form of loans and equity, and also issued a green bond. It is this corporate bond, which the mortgage refinancing issued in 2022 and commenced trading on March 14, 2022 on the Nairobi Securities Exchange (NSE) that they want investors to receive their 3rd principle partial repayment and 6th interest payment on Friday February 28, 2025.
The World Bank injected approximately Ksh 25 billion to KMRC in the form of a concessional loan through the National Treasury, while the African Development Bank (AfDB) provided Ksh10 billion towards the project.
KMRC also received additional funding from 19 undisclosed financial institutions comprising seven commercial banks, 11 Sacco’s and one micro financer (Kenya Women Microfinance Bank) which bought shares through a participating programme amounting to Ksh2.0 billion. As at September 2020, KMRC had raised funds worth Ksh 37.3 billion.
KMRC has two products namely affordable housing loans and market housing loans.
Affordable Housing Loans: These are loans that are extended to Primary Mortgage Lenders (PML) to refinance mortgage loans capped at Ksh 4.0 million for Nairobi Metropolitan Area (Nairobi, Kiambu, and Machakos & Kajiado) and Ksh 3.0 millionelsewhere, at a 7.0% interest rate to individual borrowers whose monthly income is not more than Ksh150,000.
Market Housing Loans: These are loans that are extended to Primary Mortgage Lenders to re-finance mortgage loans above the affordable housing loans threshold. The market housing loans are valued above Ksh4.0 million, and will be issued at interests determined by the average market rates.
