Sanjaya Gupta, MD, PNB Housing Finance in an interview to CNBC-TV18 speaking about the business and the outlook going forward said the growth on loan against property has been stable along with the credit quality on that portfolio.
However, loan against property is not a regulated product and therefore different lenders have different nuances, he said. PNB Housing has always has a conservative approach. Therefore the quality of the portfolio is strong, he added.
The rating agencies like Fitch and others have put Punjab National Bank (parent of PNB Housing Finance) on a negative watch with negative implication. Will this impact capital raising for PNB Housing?
Gupta said it won’t be a concern but the real concern is on liquidity position at the macro level, and the way the G-sec curves have been moving up they are bound to adversely impact the entire housing finance sector. Most of the companies borrow about 50-55% from capital markets.
With regards to corporate lending, he said the company has also been conservative in choosing the developers, the projects and market positioning of the projects, adding that they generally lend to mass market projects and avoid luxury-end projects.
He said loan growth for the company has been regulated, well-planned and not aggressive.
The company raised about Rs 30,000 crore in the last 24 months and Rs 18000 in the last 12 months, said Gupta, adding that only about 27-30 percent of borrowings will be re-priced in FY19.
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