HF additional shares begin trading

July 11, 2008
Shares

, NAIROBI, July 110 – The 115 million additional shares of Housing Finance (HF) began trading Friday, 35 percent above the offer price.

The shares hit the market at Sh27 from the offer price of Sh20.

Housing Finance carried out its rights issue with the aim to strengthen its capital base, increasing its deposits and leveraging its balance sheet.

HF Managing Director Frank Ireri said since the asset-backed Securities Regulation law was passed, the mortgage lender would now work to increase its lending capacity.

The rights issue raised more than the targeted Sh2.3 billion, significantly increasing the firm’s lending capacity to Sh20 billion. 

Speaking during the launch of the shares in the market Friday, Ireri revealed that major shareholders Britak and Equity Bank took up their full rights and additional shares.

He added that breakdown in ownership would be announced next week once the amalgamation of the new and old shares takes place.

“We had 115 million existing (shares) and the 115 that were uploaded. (Once) amalgamated, it can go public next week. But I can tell you, in terms of our key shareholders, they not only took up their rights they also took up additional rights,” he said.

The Government did not take up its rights in the issue in the mortgage lender as expected, reducing its stake in the company.

Several State initiatives are underway expected to increase interest in both housing and saving for mortgage products.

Among these initiatives are incentives for infrastructure development, saving mobilisation, Diaspora and capital resource mobilisation, housing development processes and slum improvement.

If fully implemented, these incentives would result in increased activity the housing business adding buoyancy to the economy.

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