39604 - Pakistan MRCL

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Summary of Investment Information

Project Number

39604

Company Name

PAKISTAN MORTGAGE REFINANCE COMPANY LIMITED

Date SPI Disclosed

Apr 16, 2018

Country

Pakistan

Region

Middle East

Projected Board Date

Mar 16, 2020

Environmental Category

FI-3 - No Impact

Status

Active

Last Updated Date

Sep 30, 2022

Department

Regional Industry FIG MCT

Industry

Financial Markets

Previous Events

Approved : Apr 28, 2020
Signed : Jun 30, 2020
Invested : Dec 30, 2020

Sector

Secondary Mortgage Institutions

Additional Project Attributes

Blended Finance

Project Description

The proposed Project consists of an IFC equity investment in the Pakistan Mortgage Refinance Company Limited (“PMRCL” or the “Company”), which will be supported by blended concessional financing from IDA PSW Blended Finance Facility. PMRCL seeks to provide long term funding to financial institutions at fixed rates to enable them to on-lend long term mortgages at affordable prices and thereby facilitate development of the underpenetrated housing finance market in Pakistan.

Associated Advisory Engagement

IFC has provided an advisory engagement to PMRCL under which IFC helped to support the set-up of PMRCL’s operations and the design of its corporate governance framework. The IFC advisory also entails supporting the Company to develop its guidelines on mortgage refinancing for underwriting both conventional and Islamic mortgage loan portfolios.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	3.20

Development Impact

The expected development impacts from the Project are to address key market inefficiencies and promote access to housing finance in Pakistan, by supporting PMRCL in refinancing housing portfolios of primary mortgage lenders (PMLs) at fixed rates and with longer maturities. This in turn is expected to promote private sector participation and competition in the housing finance market in Pakistan. PMRCL is also expected to regularly issue bonds to finance its operations which will help deepen capital markets in Pakistan.

E&S Category Rationale / Risks and Mitigation

The proposed project consists of an equity investment in PMRCL. PMRCL’s business activity is to refinance housing portfolios of PML (mainly commercial and Islamic banks). Environmental and Social (E&S) risks associated with the project are minimal as the refinancing is limited to home loans and does not entail construction or real estate development. For PMLs portfolios, where there are loans for construction of a property by an individual, PMRCL refinance is only eligible after the construction is completed. This project is classified as Category FI-3 project according to IFC’s Sustainability Policy. PMRCL has an E&S policy and procedures in place to ensure that PMLs screen their mortgage portfolio against applicable E&S requirements set by PMRCL. PMRCL Human Resources (HR) policies and procedures are in line with IFC Performance Standard 2 (PS2) on Labor and Working Conditions. PMRCL will continue to ensure compliance with PS2 and is required to inform IFC of any changes in the scope of financing.

Contacts

For Inquiries About the Project, Contact

Pakistan Mortgage Refinance Company Limited
Mr. Zulfiqar Alam
Group Head Business and Products
+9221 35633363
zulfiqar.alam@pmrc.com.pk
6th Floor, Bahria Complex I, M.T. Khan Road, Karachi – 74000, Pakistan
www.pmrc.com.pk

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