General Activities of the Bank during 2003-04

Policy Review

Refinance

Modifications in Refinance Scheme for Apex Co-operative Housing Federations (ACHFS)

During the year 2002-03, the Refinance Scheme applicable to ACHFS was modified, inter alia, to introduce maturity linked interest rates. In order to align them with the general market movements of the industry, this year the scheme was further modified to introduce pricing of refinance based on their recovery performance. The bare outlines of the modifications are

· The scope of the scheme has been extended to include loans given directly to individuals in addition to loans given through primary societies as eligible for being refinanced under the scheme.
· As per the earlier scheme, an ACHFS to be eligible for refinance must have ‘A’ or ‘B’ class audit classification for the last three years. It was observed that few states did not follow this method of audit classification. Accordingly, fulfillment of this criterion in such states, where the system of awarding audit classification is not prevalent, was dispensed with.
· The earlier eligibility criteria of declaration of dividends during three out of five preceding years was replaced with the criteria of being a profit making institution for preceding three years.
· For the purpose of refinance, ACHFS are classified into two categories based on their recovery performance viz. Category I ( with recovery of 75% and above) and Category II (with recovery of not less than 60% with an increase in recovery performance of at least 5% over the previous years level in each of the last two years). The interest rate applicable to Category II ACHFS will be 0.50% more than that charged to Category I ACHFS.

Introduction of Scheme for Short Term financial Assistance to HFCs

While NHB extends refinance assistance to housing finance companies (HFC) in respect of housing loans disbursed by them, these institutions have to meet their short term liquidity requirements from competitive market sources. In order to cater to this need, NHB introduced a scheme to provide financial assistance to the HFCs for their short term liquidity requirements arising in the normal course of business. The salient features of this scheme are:

· The HFC must comply with all the eligibility conditions of the Refinance Scheme and must have minimum H4 rating as per the Bank’s Internal Credit Rating Model.
· The assistance under this scheme may be drawn for a minimum period of 15 days and in multiples thereof with a maximum period not exceeding 90 days.
· The loan availed shall be repayable in one bullet instalment along with accrued interest at the end of the term.
· The loan to be provided under this scheme is unsecured.
· The rate of interest under the scheme is as under :

Repayment period Fixed Rate of interest*
Upto 45 days 5.50%
46 days to 90 days 5.60%
* Concession under GJRHRS not available

Project Finance

Project Finance Loan Policy

With a focus on broadening the project finance portfolio of the bank, the ‘Project Finance Loan Policy’ was introduced in September 2003. The policy introduced an Internal Credit Rating Model (ICRM). The scope of the Loan Policy has been widened to also include private sector and joint sector entities as eligible borrowers. It is, therefore, expected that the Bank will play more meaningful role in future with regard to the provisions of projects for housing construction particularly in the area of Slum Improvement, Economically Weaker Sections and Low Income Group segments.

Reduction in interest rates

The interest rates applicable to schemes of Project Finance have been revised downwards during the year 2003-04. Additionally, under direct finance, tenure based interest rates upto a maximum tenure of 15 years have been introduced. Presently, the borrowers also have the option to choose between fixed and floating rates of interest.

Residential Mortgage Backed Securitisation (RMBS) policy

The Bank also formulated an RMBS Policy, so as to ensure minimum level of standards and unambiguity in the RMBS issues brought out by it. The Policy details the entire gamut of activities to be taken up by NHB and also sets forth guidelines for the same.

Information Technology Policy

The Bank appointed M/s KPMG Advisory Services Pvt. Ltd. to formulate a comprehensive Information Technology Policy and Information Systems Plan in December 2003. Besides exploring the Bank’s internal systems and processes, the consultants also studied the external environment and had interviews with important functionaries in the Government, RBI, and Housing Finance Companies. The consultants have proposed an IT strategy based on the findings of their studies and a roadmap for its implementation. They have also suggested functional policies based on the best practices. The Bank proposes to incorporate the recommendations of the consultant in its policies and plans for the coming years.

Risk Management Policy

In compliance with the regulatory requirements as stipulated by the Reserve Bank of India, the Bank had formulated a Risk Management Policy in May, 2003. The Bank also engaged the services of M/s ICRA Advisory Services to improve the structure of risk management and control systems in the Bank and a framework for compliance of the Risk Management Policy. The report received from the consultant is being examined for implementation.

The Asset Liability Management Committee [ALCO] headed by Chairman and Managing Director and comprising of top/senior executives representing the different operational areas of the Bank continued to review and monitor liquidity position and interest rate gaps at fortnightly intervals.

Regulation & Supervision

Amendments to Housing Finance Companies (NHB) Directions, 2001

Having considered it necessary in public interest and for the purpose of regulating the housing finance system, the Bank issued the following Directions to the housing finance companies, during the year.

· To maintain uniformity in the interest rate payable on repatriable deposits accepted from the non-resident Indians by the various players in the financial system, the Bank advised HFCs in September 2003 that the interest rate payable by them on such deposits should be the same as is payable by the scheduled commercial banks on these deposits from time to time.
· Considering the fact that financing of real estate forms an integral part of the business of a HFC, the ceiling on investments by a HFC in real estate except for its own use was raised from 10% of a HFC’s owned fund to 20% of a HFC’s capital fund as on March 31 of the previous year subject to the stipulation that the additional limit would be permissible only for investments in residential units.
· In order to align the investment classification and inter-class transfer norms of HFCs with those applicable to the non-banking financial companies (NBFCs), the Bank amended the Housing Finance Companies (NHB) Directions 2001 regarding the prudential norms relating to classification and valuation of investments This amendment interalia specifies that the investments in securities shall be classified into current and long term at the time of making each investment and that there shall be no inter-class transfer from current to long term or vice versa on ad-hoc basis and if warranted, the inter class transfer can be effected only at the beginning of each half year.
· During the year, the Bank also advised HFCs that they should not sanction loans to State Government Undertakings/Special Purpose Vehicles (SPVs) for any project solely on the basis of guarantees extended by the State Governments and instead sanction loans only after a through appraisal of the project regarding identification of risks, risk mitigation measures, financial viability of the project and the creditworthiness of the borrower etc. Similarly, in respect of the housing/infrastructure projects, HFCs have been advised to undertake due diligence on the viability of the projects.

Registration of Housing Finance Companies u/ Section 29A of the National Housing Bank Act, 1987

Till the end of June 2004, the Bank had received 165 applications from HFCs for granting of Certificate of Registration (COR). Of this, 46 HFCs have been granted COR and applications received from 106 HFCs were rejected. In another 6 cases, show cause notices have been issued as to why their applications should not be rejected. In 7 cases, the COR granted earlier were cancelled as these HFCs either went out of the housing finance business or due to non compliance with the conditions subject to which the COR were issued.

Public Notices regarding obtention of COR from NHB.

As a part of public awareness campaign, the Bank issued two public notices in November, 2003 and June, 2004 in all prominent newspapers in the country regarding the necessity for obtaining a COR from the Bank for a HFC to commence/carry on the business of housing finance under section 29 A of the National Housing Bank Act, 1987. The notice further cautions the public that they have to satisfy themselves that the concerned company has obtained COR form NHB before placing deposits or otherwise dealing with the company and the deposits with HFCs are neither insured nor guaranteed by NHB.

Co-ordination with other Regulatory Authorities

The Bank’s officers continued to attend State Level Co-ordination Committee Meetings convened by the Reserve Bank of India during the year to ensure co-ordination with RBI and other Regulators for effective supervision of the HFCs.

During the year, the Bank appointed (on retainer ship basis) Company Secretaries (CS) for gathering Market Intelligence in various States where the office of the Registrar of Companies is situated. As on June 30, 2004, 15 Company Secretaries have been appointed for the purpose of monitoring the activities of the HFCs at the field level. Further, these Company Secretaries have been advised to gather information specifically with respect to the HFCs whose application for registration has been rejected and the HFCs who have not applied for registration. This arrangement has been introduced with effect from September 2003.

Penal action for non-maintenance of requisite level of liquid assets

Bank continued to view seriously non-adherence to its directions regarding maintenance of requisite level of liquid assets for public deposits mobilised by HFCs. Action has been initiated for collection of penal interest wherever necessary for non-maintenance of required level of liquid assets as per the provisions of the National housing Bank Act, 1987 in line with the policy adopted by the Bank in this regard.

Golden Jubilee Rural Housing Finance Scheme

In order to facilitate housing in rural areas and promote housing finance in the rural sector, the Government has introduced the Golden Jubilee Rural Housing Finance Scheme in the year 1997. There has been encouraging performance under the scheme which continues to benefit increasing number of rural households. This can be assessed by the number of units financed under the scheme. During the year 2003-04, the Government of India had set a target of financing 2, 50,000 units against which 2, 43,753 lakh units were financed by the primary lending institutions. Achievement of various categories of lending institutions is as follows:

(Number of dwelling units)
Category of Institutions Target Achievement
Banks 119275 171180
Housing Finance Companies 126000 71697
Others including Co-operative sector institutions 4725 876
TOTAL 250000 243753

Up to the year ended 31st March, 2004, against the cumulative target of 10.75 lakh units to be financed, the achievement had been 10.86 lakh units. For the year 2004-05, target of financing 2, 50,000 units has been set by the Government of India.

Business Planning and Promotion Activities of NHB during 2003-04

Equity Participation by NHB

At the beginning of the year, the Bank had equity participation in Five HFCs. However, continuing the last year’s trend of merger of bank sponsored HFCs with their parent organisations, NHB divested its entire holding in Vibank Housing Finance Limited, consequent to its plans of merger with Vijaya Bank. There was no fresh equity participation by the bank during the year.

Setting up of ‘Fraud Cell’

In order to identify the causative factors behind frauds of housing loans in HFCs, NHB has set up a ‘Fraud Cell’ to collect from HFCs information regarding frauds on housing loans generated by them. This information is collected on a regular basis. The information collected is analysed and inferences regarding the causative factors are shared among all HFCs and also with RBI as a part of preventive measure.

Addressing Consumer Grievances

The bank addresses complains against HFCs received from individuals. During the year the bank received 125 complaints, 46 regarding deposit acceptance activities of the HFCs and remaining 79 pertaining to other aspects. All these complaints were attended to and as on 30th June 2004, 100 complaints were disposed off. The remaining cases were under process.

Training

As a capacity building measure in the housing finance sector, the Bank organises various training programmes on matters related to housing finance. These programmes are attended by officials of housing finance companies, banks, cooperatives, public housing agencies and institutional investors of the sector. Both in-house and external faculty share their knowledge with the participants.

The bank conducted twelve such training programmes during the year and more than 250 officers from various Housing Finance Companies and Banks participated in these programmes. The programmes addressed issues related to general awareness on housing finance and specialised topics such as Regulatory framework for housing finance, Securitisation, Legal issues in Housing, SARFAESI Act, Risk Management etc.

Apart from conducting programmes, Bank also provided faculty support to Banks, HFCs and National Co-operative of Housing Federation for conducting training programmes for their personnel.

Residential Mortgage-Backed Securitization (MBS)

Ten RMBS issuances aggregating to Rs.663.92 crore have been brought out till 30th June, 2004, with the Bank assuming the role of Trustee (to the Special Purpose Vehicle Trusts) in the transactions involving individual home loans of six HFCs viz. Housing Development Finance Corporation, LIC Home Finance Ltd., Canfin Homes Ltd., BOB Housing Finance Ltd., Dewan Housing Finance Corporation Ltd. and BHW Birla Home Finance Ltd., and one Scheduled Commercial Bank, viz. Andhra Bank.
New RMBS Issuances

NHB brought out four RMBS issues during the year involving individual home loans of CanFin Homes Ltd. (CFHL), Andhra Bank (AB), Dewan Housing Finance Corporation Ltd. (DHFL) and Birla Home Finance Ltd. (BHFL). The details of these issues are as follows:

Name of the Pool(Originators) No. of Loans Pool size PTC “A” size PTC “B” size Date of issue PTC “A” coupon Credit Enhancements
CP-3(CFHL) 2007 Rs. 64.13 crores Rs. 54.45 crores Rs. 9.68 crores July 2, 2003 6. 25% p.a. payable monthly Cash Collateral Rs0.39 crores by originator
DP-1( DHFL) 3155 Rs. 69.79 crores Rs. 61.83 crores Rs. 7.96 crores March 5, 2004 6.98% p.a. payable monthly Bank Guarantee of Rs. 1.24 crores by originator
SCB-AB1(AB) 1437 Rs 50.36 crores Rs. 42.95 crores Rs.7.41 crores March 19, 2004 6.15% p.a. payable monthly Cash Collateral Rs. 68 lakhs by originator
Bh-1(BHFL) 1058 Rs. 34.38 croresPlus Premium of Rs.9.27 crores Rs. 30.71 crores Rs. 3.67 crores March 19, 2004 6. 60% p.a. payable monthly Cash Collateral Rs9.80 crores by originator

The issue of Birla Home Finance Ltd. was the first issue by the Bank where the PTCs (Senior Class) were issued at par with a premium pricing. This product is an innovation in the industry.

Performance of the Securitised Pools:

With the credit risk component in the home loan sector being typically low as also due to the cherry picking exercise according to a stringent selection criteria specified by NHB for selection of the home loans to be securitised, all ten issues brought out by NHB have performed according to expectation. The average collection efficiency in each of the securitised pool ranged between 95% -99%. The trends in NHB’s RMBS transactions indicate that the total collections from the pools were adequate to service not only the scheduled payments to Senior Class RMBS holders, but also contributed substantially to the residual income of the holders of subordinate RMBS holders. The subordination ratio has been consistently increasing over the months, imparting a higher amount of cushion to the PTC A holders in terms of credit enhancement. Needless to mention, there has been no instance of tapping of collaterals to meet any shortfall in payment to the Senior RMBS holders till date. The yield to the PTC A holders has been consistent with that indicated in the Information Memorandum at the time of issue.

Developments during the year 2003-04

The Bank assumes the responsibility of the Trustee for RMBS issues to ensure transfer, payment and timely servicing to the investors in the PTCs. The Bank also has the mandate to invest in its own issues of RMBS. Recognising the dual role required to be played by the Bank, i.e. of a Trustee as well as an investor, the Bank set up a Committee, “RMBS Trust Supervision Committee”, under the Chairmanship of a retired High Court Judge to supervise the activities of the Trust periodically in respect of MBS issues where NHB is interested in capacities other than that of trustee, so as to ensure that the interest of investors is duly protected.

NHB has also initiated the process of introducing Credit Enhancement measures such as Guaranteeing the senior portion of the RMBS and Financial Support for subordinate RMBS by way of refinance etc. to facilitate more MBS issues by HFCs and Banks.

Coordination with RBI regarding policy issues pertaining to RMBS

At the Bank’s initiative, RBI has advised Banks and Financial Institutions that the risk weight on investment by Banks and Financial Institutions in RMBS originated by another Bank would attract a risk weight of 50%. Earlier, this concession was available only to RMBS issues originated by HFCs regulated and supervised by NHB.

Measures for Market Development

With a view to facilitate the development of secondary mortgage market and bring about standardization in the primary home loan market, NHB has commissioned the Administrative Staff College of India (ASCI) to undertake a study with the main objective to understand, analyse and assess the credit and prepayment risks in the housing finance sector. The study is being undertaken in two phases – the pilot and the final stage. ASCI have concluded the pilot phase and are in the process of final phase involving larger and diversified samples of housing loans from HFCs.

NHB has also constituted a Working Group with representatives from the housing finance companies to recommend measures for standardization in the primary residential mortgage finance sector. The Working Group submitted the report which is being evaluated.

The books of accounts of the Trust(s) have been audited till March 31, 2004.

Mortgage Credit Guarantee Corporation

As mentioned in the last report, the Bank had taken a lead role in promoting the concept of mortgage default guarantee in the country and initiated the process of setting up of a Mortgage Credit Guarantee Company in collaboration with Canada Mortgage and Housing Corporation (CMHC), United Guarantee (UG), International Finance Corporation (IFC) and Asian Development Bank (ADB). During the year the term sheet has been finalised between the Partners.

Board of Directors

Changes in incumbency

Under Section 6(1) (c)
Dr. P.S. Rana, Chairman & Managing Director, Housing & Urban Development Corporation Ltd. with effect from November 25, 2003 in place of Shri L.M. Mehta, Chairman & Managing Director, Housing & Urban Development Corporation Ltd.

Under Section 6(1) (d)
Dr. Rakesh Mohan, Deputy Governor, Reserve Bank of India with effect from December 30, 2003 in place of Shri Vepa Kamesam, Deputy Governor, Reserve Bank of India.

Shri V. Leeladhar, Deputy Governor, Reserve Bank of India with effect from September 30, 2004 in place of Dr. Rakesh Mohan, Deputy Governor, Reserve Bank of India.

Under Section 6(1) (e)
Shri A.N. Tiwari, Secretary, Ministry of Urban Employment & Poverty Alleviation with effect from March 17, 2004 in place of Shri S.S. Chattopadhyay, Secretary, Ministry of Urban Employment & Poverty Alleviation. Since August 12, 2004, Smt. Chitra Chopra, Secretary to the Government of India, Department of Urban Employment and Poverty Alleviation has been appointed in place of Shri A. N. Tiwari.

Shri Amitabh Verma, Joint Secretary, Ministry of Finance with effect from March 18, 2004 in place of Shri Shekhar Agarwal, Joint Secretary, Ministry of Finance.

Under Section 6(1) (f)
Shri J.N. Singh, Secretary (Housing), Urban Development and Urban Housing Department, Government of Gujarat with effect from September 23, 2003 in place of Shri A. Bhattacharya, Secretary (Housing), Urban Development and Urban Housing Department, Government of Gujarat. Shri. Singh has since been transferred to Science and Technology Department by the Government of Gujarat. A notification for change in incumbency from the Government of Gujarat is awaited.

Smt. Rajalakshmi, Principal Secretary to the Government of Orissa, Housing and Urban Development Department, Government of Orissa with effect from November 25, 2003 in place of Shri A.K. Samantaray, Principal Secretary to the Government of Orissa, Housing and Urban Development Department, Government of Orissa.

Shri N.C. Vasudevan, Commissioner cum Secretary to the Government of Orissa, Housing & Urban Development Department, with effect from September 20, 2004 in place of Smt. Rajalakshmi, Principal Secretary to the Government of Orissa.

Corporate Governance

The management of the Bank is committed to implement the mandate given by the National Housing Bank Act, 1987. ‘Housing for all’ is the ultimate goal of the Bank. The nature of the housing finance industry both at domestic and international fronts has undergone many changes over the last decade. In order to improve the competency in meeting these challenges, specially in this age of integration of markets world wide, the Bank has set itself some principles as a measure of good and effective corporate governance. With this in mind, the Bank ensures:

a. that the Bank's Board of Directors meets regularly, provide effective leadership, exercise control over management and monitor executive performance.
b. that the Chairman has responsibility for all aspects of executive management and is accountable to the Board for the ultimate performance of the Bank and implementation of the policies laid down by the Board.
c. that a senior executive is made responsible to the Board in respect of compliance issues with all applicable statutes, regulations and other procedures, policies as laid down by the Board and report deviation, if any, to the Board.
d. accountability for performance and to achieve excellence at all levels.
e. transparency and integrity in communication and to make available full, accurate and clear information to all concerned.
f. that clearly documented and transparent management processes for policy development, implementation and review, decision-making, monitoring, control and reporting are established.

Good and effective corporate governance is a more of organization culture than applicable rules. By achieving our self imposed targets, we are confident of making NHB the ‘the most preferred destination for housing finance institutions’ to raise resources.

Board of Directors

The management of affairs and business of the Bank is vested in the Board of Directors headed by Chairman and Managing Director of the Bank. The other members of the Board comprise of eminent personalities besides representatives from RBI, Central Government, etc. The meetings of the Board are held at regular intervals and at least once in a quarter and as provided in the NHB General Regulations, 1988. During the year 2003-04 (July to June), the Board of Directors met 5 times.

Committees of the Board

The Board has constituted two committees viz. a) Executive Committee [EC] and b) Audit Committee of the Board [ACB] to enable better and more focused attention on the affairs of the Bank and has delegated certain powers to these Committees. The functions of EC and delegation of power to EC are well defined. The minutes of the EC and ACB are placed before the Board for information.

Executive Committee of Directors

The Executive Committee of Directors met thrice during the year 2003-04. During the period under review, the strength of the Executive Committee of Directors was enhanced from 4 to 6 to have the benefit of larger and wider participation of members in the meetings.

Audit Committee of the Board

The ACB provides directions and oversees the operations of the total audit functions in the Bank. The total audit function implies the organization, operationalisation and quality control of internal audit and inspection within the Bank and follow-up and compliance in respect of statutory audit of the Bank and inspection by RBI. The ACB reviews the effectiveness of the systems of internal control, and major areas of house keeping and accounting policies; the accuracy and fairness of the financial statements and compliance with the regulatory guidelines. The ACB also monitors the working of inspection wing of Department of Regulation and Supervision (DRS) and major irregularities observed in the working of HFCs during DRS inspections. The ACB acts as an interface between the management, statutory auditors and internal auditors. It is the prerogative of the ACB to invite senior executives, statutory auditors and internal auditors whom it considers appropriate to be present at the meetings.

The Committee is expected to meet at least four times in a year. During the year 2003-04 (July to June), the Audit Committee of the Board met 4 times. The strength of the Audit Committee of the Board was enlarged from 4 to 6 during the year to have the benefit of larger and wider participation of members in the meetings.

Statutory Auditors

The statutory auditors are appointed by RBI. The Annual Accounts of the Bank together with the report of the Statutory Auditors are placed before the Board for adoption and the Statutory Auditors are invited to the Board meeting where the Annual Accounts are adopted to express their views and observations on the Accounts.

Human Resources

Staff Strength

The total staff strength of the Bank, as on 30th June, 2004, stood at 84 as against 74 at the close of the previous year. To upgrade the skills and enhance the proficiency of its human capital, the Bank deputed its officers for various training and management development programmes during the year, besides organizing in-house programmes for this purpose.

Compliance with Reservation Policy

The Reservation Policy of the Government of India is being adhered to by the Bank. A Liaison Officer is functioning in the Bank. Post based rosters are being maintained by the Bank as per the guidelines of the Government in this regard.

Rajbhasha

The Bank has remained fully committed, since its inception, for the successful implementation of Official Language Policy and has initiated effective measures for the progress of use of Hindi in the Bank. It has always been a policy of the Bank that through inspiration and incentives, the use of Hindi should constantly be increased and the Bank has succeeded in this regard substantially and efforts are on to bring about further improvement in this area.

Various statutory provisions stipulated by the Government regarding Official Language are strictly adhered to. In order to inspire Bank’s officers to use Hindi in their day to day official work, incentive schemes have been introduced in the Bank. A large number of Hindi books are being purchased for library of the Bank for the benefit of the officers of the Bank.

To develop the creative capacity of the Bank’s officers, ‘Awas Bharati’, a quarterly Hindi News Letter, is being published regularly. The ‘Awas Bharati’ secured fourth position in the competition for In-house Hindi Magazine for the year 2001-02 organised by Reserve Bank of India and this prize was received in March, 2004 by the CMD of the Bank from the Governor of RBI. Besides, ‘Awas Bharati’, also secured 2nd position in the competition organised by Delhi Nagar Raj Bhasha Implementation Committee for Raj Bhasha Patrika of Delhi based Banking & Financial Institutions for the year 2002-03.

Bank’s Regional Office in Mumbai also gives due importance to the use of official language. The Bank Nagar Rahbhasha Implementation Committee of Mumbai as well as State Level Rahbhasha Implementation Committee awarded 2nd rank to the Mumbai Regional Office of the Bank, in the category of Financial Institutions for performing best work in Hindi during the year 2002-03.

Miscellaneous

Bank’s Web-site

The Bank’s official website “www.nhb.org.in” has been further improved during the year and its Hindi version was made fully operational. The website provides information about the Bank’s business activities, organisation, publications, information for HFCs’ depositors, etc. Sample application forms for companies wanting to register with NHB as HFCs and application for individuals/institutions wanting to invest in bonds of NHB are available at the site.

New Initiatives

Initiative as a good corporate citizen

During the year the Bank organised a Painting Competition for the children from the economically weaker segment of the society studying in different schools in Delhi. The theme of this competition was ‘My Dream House’ and the dreams of the kids captured from the paintings made by them were used for the Corporate Calendar of the Bank for the year 2004.

Rural Housing

i. In order to assess the need, adequacy, demand and financing pattern of housing in rural areas of the country, the Bank, during the year, commissioned a study to examine these issues for the Sate of Andhra Pradesh on a pilot basis. The major objectives of the study are:

(a) review the housing policy of the government, instruments used, measures initiated and their limitations with focus on rural housing
(b) assess the shelter need of households in the rural areas
(c) map the existing rural housing finance and to analyse the pattern of financing housing construction in recent years
(d) examine the viability of financing rural housing ventures in light of the above
(e) based on the above, draw policy implications that are useful to restructure institutions and programmes related to rural housing.

Based on the results of this pilot study, the Bank will decide about conducting the similar exercise in respect of other States to assess the position in respect of above issues in the rural parts of the country.

ii. The Bank published “Handbook on Rural Housing and Infrastructure” in collaboration with Central Building Research Institute, Roorkee, for providing a comprehensive information on various aspects relating to rural housing such as planning, construction, use of local materials and typical designs along with specifications and cost estimates.

Research Studies

i. During the year the Bank has commissioned a study through Administrative Staff College of India to find out the relationship between various features relating to individual housing loan viz. Loan to Value Ratio, Installment-Income Ratio, number of dependents, etc. with default and prepayment risks.
ii. As per the provisions of National Housing Bank Act, the Bank prepares a ‘Report on Trend & Progress of Housing in India’ every year. Centre for Symbiosis of Technology, Environment & Management (STEM), Bangalore has been commissioned to undertake a study on behalf of the Bank to enlarge the coverage of this report.

Organisation Structure

To enable the Bank to meet the challenges arising out of changing market dynamics, the services of the Administrative Staff College of India (ASCI), Hyderabad were engaged to suggest a revised organisation structure for the Bank. The revised Organizational Structure has been put in place with effect from May, 2004.

The services of Xavier Labor Relations Institute, Jamshedpur have been engaged for undertaking a Competency Mapping Exercise so as to enable the Bank to devise a suitable training policy as well as for initiating other steps necessary to fill the gaps in the competency levels required in various areas.