New housing deal for CMA staff

November 17, 2008
Shares

, NAIROBI, November 17- Mortgage company Savings and Loans (S&L) has entered into a Sh100 million cash-backed mortgage arrangement with the Capital Markets Authority in a deal that will enable CMA staff own homes at affordable rates.

Speaking at the signing ceremony, S&L Managing Director Caroline Kariuki said minimising the rising housing deficit required a concerted effort by the private sector to bolster the government’s efforts in providing decent and affordable housing.

“We will continue to build partnerships with various sectors of the economy in order to accelerate development of housing units for the sake of the people of Kenya,” said Ms Kariuki.

Under the deal, S&L will charge a fixed seven percent interest rate on the loans per year, charged on a reducing balance.

“This portends a highly competitive deal in the market as interest rates presently are as high as 18 percent,” Ms Kariuki said.

The outsourced mortgage plan of up to 100 percent financing will enable the staff to buy land, construct or purchase ready units.

The loans are repayable over a 20-year period or up to the age of 60 years, whichever comes first and will be available in the 150 branches of S&L.

“We have no doubt that this partnership will go a long way in helping address the need for housing amongst employees,” she noted.

In May this year, S&L signed a Sh600 million employee house ownership agreement with the Ministry of Housing that enables civil servants to own houses.

In addition, the mortgage firm has similar arrangements with employers in the private and public sector institutions, which allow for competitive interest rates to be negotiated.

S&L has two savings accounts to facilitate customers own homes by saving up to a maximum of Sh4,000 per month.

“The housing development bonds, for example are a deposit product that attracts lower withholding tax of 10 percent instead of 15 percent,” Ms Kariuki stated.

Meanwhile Chief Executive of the Capital Markets Authority Stella Kilonzo has reassured investors at the Stock Exchange that the Authority is keenly monitoring activities in the bourse to ensure that the law is upheld.

Ms Kilonzo was reacting to concerns that a number of counters had encountered issues of irregular trade which the CMA had taken time to respond to.

The latest irregularity was the Kenol share, which went up by 42 percent on the November 3.

“We are doing something about it since we have real time surveillance that should always ensure we are on top of things,” Ms Kilonzo reassured.

Ms Kilonzo further pointed out that the CMA has been reviewing current legislation under the auspice of the Ministry of Finance and the World Bank.

Shares

Latest Articles

Stock Market

Most Viewed