Financial Services

NHB(ND)/ROD/HFC/LRS/05/2003

October 8, 2003

<< Housing Finance Companies >>

Dear Sir

Refinance Scheme as applicable to Housing Finance Companies, 2003

Kindly refer to our circular NHB(ND)/ROD/HFC/LRS/01/2003 dated February 20, 2003 introducing the captioned scheme.

As per the captioned scheme a certificate on refinance outstanding and housing loans in the format NHB-ROD[HFC]-07 and a list of individual housing loans for which refinance has been obtained (all flagged loans) from NHB in the format NHB-ROD[HFC]-06 is required to be submitted as on 31st March and 30th September every year.

In this context, you are advised that from September 30, 2003 onwards, the list of flagged loans in the format NHB-ROD[HFC]-06 will be submitted as an annexure, in a floppy disc, along with the auditors' certificate on refinance outstanding and housing loans in the format NHB-ROD[HFC]-07.

Further, in addition to the certifications already included in the format, the statutory auditor will now be required to confirm that the certificate has been prepared on the basis of the enclosed list of flagged loans.

Accordingly the format of NHB-ROD[HFC]-07 has been revised and enclosed to this circular. In future, the revised format should be used to furnish the auditor's certificate on refinance outstanding and housing loans.

All other provisions of the scheme shall remain unchanged.

Kindly acknowledge receipt.

Yours faithfully,

Sd/-

Deputy General Manager
Refinance Operations Department

Encl. : NHB-ROD[HFC]-07

NHB-ROD[HFC]-07

Format of Auditor's Certificate to be submitted by HFCs on September 30 and March 31 every year
As on 30 September/31 March 20__


Table 1
Rs. in lakhs
    Individual housing loans Project Loans Total
a) Refinance Outstanding due to NHB as on September 30/March 31, 20_#      
b) Sum aggregate of all outstanding housing loans in respect of which refinance has been availed as on September 30/March 31, 20__      
c) Adverse Balance, if (a - b) is a +ve figure      


Table 2 (This table is required to be filled in only if there is an adverse balance indicated at column (c) above)
S. No. Refinance Loan A/c No.* Date of release Refinance O/s as on September 30/ March 31, 20__ # (A) Sum aggregate of O/s housing loans (B) Difference (A) - (B)
1.          
2.          
.          
Total     **

# The outstanding refinance as on September 30/March 31 should not show lesser balance due to repayment made in advance in the last week of September/March for the demand due on 1st October/1st April of the ensuing quarter.

* All loan accounts should be included in the above table irrespective of whether the adverse difference (A - B) in the last column in each row is +ve or -ve.

** This figure should tally with 1(c) above.


Certified that:

1. The figures of (a) in Table 1 above, are based on the books of accounts maintained by the company, which have been duly audited by the Statutory Auditors as on 30 September / 31 March 20__.

2. The loan accounts that were pre-closed due to shifting from fixed interest rate structure to variable rate of interest or for any other reasons and opening a new loan account of the same borrower and with the same housing unit financed as a primary security continue to be covered under the outstanding refinance from NHB. Such accounts have not been excluded while arriving at (a) in Table 1 above.

3. Book debts flagged for the purpose of collateral security/additional margin as stipulated for refinance, over and above the book debts created out of refinance, has not be counted for in the calculation of (a) in Table 1 above.

4. The loan accounts for which refinance has been taken from NHB can be distinctly identified from the records of the company. A list of all such flagged loans is enclosed in the format NHB-ROD[HFC]-06, in a floppy disc. The figures mentioned above in Table 1 and 2 have been verified by us from this list.

5. This certificate has been placed before the ___ meeting of our Board of Directors held on _____ and they have taken note of the same vide their resolution as under: _____________
Authorized Signatory Countersigned by
of the company [Statutory Auditors]


Note:

1. Funds released towards prospective loans within 3 months before the half yearly statement should not be included under NHB outstanding while computing the adverse balance in view of the lag time involved in generating housing loans.

2. For the purpose of this certificate, outstanding refinance availed by the HFC under any scheme including this scheme will have to be mentioned and similarly the housing loans outstanding in respect of all the loans for which refinance was availed will have to be mentioned under the outstanding housing loans column.

Encl. : List of flagged loans in the format NHB-ROD[HFC]-06, in a floppy disc.