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 | Standard Bank provides R2.4 billion securitisation loan for Charter partners |  |  |
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10 December 2007
Standard Bank has concluded a R2.4 billion home loan securitisation issue to assist three financial institutions with meeting their Financial Sector Charter (FSC) obligations. This is a first for the South African market.
The Siyakha Fund (meaning we are building), consisting of R2.4 billion worth of low income housing loans originated by Standard Bank, has been structured as a private placement and issued to Liberty Life, Old Mutual and Investec Bank. They will each receive equal portions of the issue.
This transaction is the first securitisation in South Africa of low income housing loans, a new innovation for the South African debt capital markets and a landmark transaction in terms of utilising securitisation technology as a mechanism to enable financial institutions to provide funding in respect of low income housing and thereby gain Charter points.
On conclusion of the Financial Sector Charter in October 2003, Standard Bank committed to assist those Charter co-signatories, whose business models precluded them from being able to directly provide housing finance to lower income individuals, to meet their Charter obligations.
Standard Bank is in the process of fulfilling its Charter commitment to provide housing loans to the lower income market. This has allowed us to package our surplus low income housing loans and offer them to our Charter partners.
In the four years since beginning of the Charter in 2004, Standard Bank has provided housing finance of R10.7 billion to the low income housing market, touching about 288 000 customers. The target for the entire industry is R32 billion in low income housing loans by 2008, shared among the Charter signatories.
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