According to the arrangement, home loans sold by HDFC Bank are booked and serviced by the housing finance player and 70 per cent of these loans are to be sold back to HDFC Bank. The total size of the pool is 6,957 residential mortgage loans, worth Rs 235 crore.
HDFC Bank, which is not in the housing finance market directly, has sold Rs 235 crore worth of home loans in a period of just over six months, following a memorandum of understanding between the two, inked in July last year.
The bank has started disbursing loans in August and managed to garner good business in a short period of time, a senior HDFC executive associated with the development said. The deal was struck on March 18.
HDFC has securitised the full amount of Rs 236 crore and assigned the loan pool in favour of IL&FS Trust Company, the trustee for the SPV Trust, which, in turn, issued pass-through-certificates (PTCs) evidencing beneficial interest in these loans. HDFC would continue as the servicer of the loans.
The figure for securitisation of home loans has been arrived at on a provisional basis. So, this might not reflect the total loan disbursement by HDFC Bank, the official told FE.
HDFC Bank will get an interest rate (annualised) of 5.93 per cent (flexible rate), which is less than 1.5 per cent of the home loan rate. This 1.5 per cent is retained by HDFC towards processing and credit costs. The average duration of these loans will be 3.2 years, the official said.
Meanwhile, Fitch Ratings has assigned an in-principle AAA(Ind)(so) rating to the securitisation of residential mortgage loans originated by HDFC.