, NAIROBI, Kenya, Nov 16- Mortgage company Housing Finance (HF) Group has posted a 56 percent growth in its after tax profit to Sh139 million for the third quarter of the year.
HF Managing Director Frank Ireri attributed the growth to product innovation, loan disbursements, lower cost of funds and lower non-performing loans.
“These solid results were achieved based on a very clear strategy that is working well and has huge potential. In addition, we continue to focus on product innovation, customer service, credit risk management and cost control,” said Mr Ireri.
Loans and advances increased by 33 percent to Sh13 billion while the interest income increased to Sh1.2 billion up from Sh932 million during the corresponding period last year.
HF’s Net Non Performing Loans portfolio dropped to Sh801 million from Sh892 million during the corresponding period last year.
Mr Ireri said the firm was banking on innovation to break into new markets in a bid to ensure the provision of affordable housing for the majority of Kenyans.
Only about 35,000 housing units are developed every year in urban areas against a total demand of150,000 units.
The group has taken various initiatives in its quest to bridge this gap and recently launched a pension backed mortgage solution that allows potential home owners to use up to 60 percent of their accumulated pension benefits as additional collateral for the mortgage loans.
Housing Finance has also diversified into commercial property financing to grow revenues and has set up a unit which finances a range of property types including office space, retail shopping centers, industrial usage, hospitality and educational use.
The financier expects demand to grow in the youth market; in urban areas and in the informal sector which employs 78 percent of the population.