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IFL Home Finance has successfully secured a loan of $50 million from the US International Development Finance Corp (DFC) in its pursuit to expand its affordable housing finance portfolio, with a notable emphasis on promoting sustainable housing initiatives. The loan, obtained at a favourable concessional rate of 5.72 percent, inclusive of hedging costs, showcases the increasing confidence of international investors in India's burgeoning affordable housing sector, which has gained significant momentum through the unwavering support of the government. Notably, this marks the second instance of debt-raising by the mortgage lender this year, following a substantial investment of $68 million from the esteemed Asian Development Bank in January.
According to Monu Ratra, the esteemed CEO of IIFL Home Finance, overseas investors, particularly development financial institutions, recognize the immense potential of affordable housing as an area where their investment can yield a significant impact in developing nations. Such investments align seamlessly with their overarching goals of fostering sustainable cities, nurturing vibrant communities, and driving meaningful climate action. This sentiment is further reinforced by the recent success of Shriram Housing Finance, another key player in the affordable housing segment, which raised an impressive $50 million in its maiden external commercial borrowing from Canara Bank's London branch.
In the previous year, the Abu Dhabi Investment Authority (ADIA), through its wholly-owned subsidiary, acquired a 20 percent ownership stake in IIFL Home Finance for an approximate amount of Rs 2,200 crore. It is worth highlighting that IIFL Home Finance, a subsidiary of IIFL Finance, is primarily dedicated to serving the economically weaker sections and lower-income groups. As of June, the institution boasts robust assets under management portfolio amounting to Rs 29,595 crore, with the majority derived from home loans. Notably, the lender also extends its financial support through loans against property to small enterprises and offers valuable construction finance services as part of its diversified lending verticals.
Furthermore, the unwavering commitment of IIFL Finance to financial growth is exemplified by its recent achievement of raising $175 million in a three-year external commercial borrowing endeavour. Esteemed lenders such as HSBC, Bank of Baroda's overseas branches in Gift City, and Union Bank of India's Sydney branch played integral roles in this successful fundraising campaign. With a blended cost of 9.2 percent, these borrowings further solidify IIFL Finance's position as a formidable player in the financial market.
In conclusion, the recent infusion of funds through the partnership between IFL Home Finance and the US International Development Finance Corp underscores the growing significance of the affordable housing sector in India's economic landscape. The strategic collaboration between domestic and international investors not only enhances financial resources but also fuels the momentum for sustainable housing and inclusive growth, underscoring the nation's commitment to fostering vibrant communities and uplifting the lives of its citizens.
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