KMRC CEO Speaks on the COVID-19 & the Real Estate/Property Market Live Virtual Forum.

Screen shot of CEO Johnstone Oltetia speaking on the Nation Media Group’s Leadership Forum on July 23rd, 2020. The virtual forum was broadcast on NTV, YouTube and Facebook Live Channels.

The Kenya Mortgage Refinance Company (KMRC) CEO Johnstone Oltetia
participated in the Nation Media Group’s ‘Nation Leadership Forum’ on Thursday 23rd July 2020 which was aired live on NTV.

Speaking as a panelist, Mr. Oltetia highlighted an overview of what KMRC is mandated to do, its alignment with the Government of Kenya’s Affordable Housing pillar of the big 4 Development Agenda, its (KMRC) Operationalization and how KMRC is positioned to support the real estate sector navigate the COVID-19 global pandemic shock.

“The role of KMRC is to provide long term fixed rate financing to primary mortgage lenders composing commercial banks, saccos and microfinance banks. We have slightly over 2.2b shillings in capital, about 22 shareholders ranging from govt to financial institutions. That kind of financing is essentially the core capital for the institution,” said Mr. Oltetia.

Mr. Oltetia highlighted the steps that the company has been undertaking since its incorporation in April 2018, prior to commencing lending, emphasizing the benefits that KMRC’s home loans will accord the borrowers and support the Government’s plan to build 500 affordable housing units under its Affordable Housing pillar of development. Mr. Oltetia also said that KMRC’s sustainability with regards to funding will be through bond issuance, adding that KMRC expects to go to the market in a year or two to issue bonds.

“The fixed long-term financing will provide the borrower an opportunity to see the end from the beginning and plan accordingly. This pandemic has reminded us of the need to have affordable housing with running water and all other amenities. We should be focusing on developing housing at scale,” said Mr. Oltetia.

The Nation Leadership Forum is an initiative of the Nation Media Group which seeks to stimulate discourse, encourage dialogue, shape opinions and key policy directions and offer practical solutions on key issues critical to Kenya’s growth. Other topics of discussion at the forum include Manufacturing, Infrastructure, Agriculture, Health, Governance and Education. Other panelists at the Covid-19 and the Real Estate were Eng. Maurice Aketch-Executive Director at the National Construction Authority (NCA) and Sakina Hassanali – Head of Research and Marketing at HassConsult.

KMRC Welcomes New Investors as it holds first AGM

The Kenya Mortgage Refinance Company (KMRC) Ag. Chairman Dr. Haron Sirima (left) with the Ag. CEO Johnstone Oltetia review the Annual Report at the KMRC Offices in Upperhill following KMRC’s inaugural Annual General Meeting (AGM) that was held virtually on Tuesday June 30, 2020.

The Kenya Mortgage Refinance Company (KMRC), the public-private partnership (PPP) firm formed by the government to make home loans affordable in Kenya, has today held its first Annual General Meeting (AGM), during which its board approved two new shareholders.

The meeting, held virtually, in line with government restrictions to stem the spread of COVID-19, saw KMRC’s board formally approve the entry of two new shareholders; the International Finance Corporation (IFC), which is the private sector arm of the World Bank and the Company for Habitat and Housing in Africa (Shelter Afrique), a pan-African housing and real estate development financier. The other shareholders include the National Treasury and some 20 Primary Mortgage Lenders (PMLs); eight banks, one MFB (Micro Finance Bank) and 11 SACCOs (Savings and Credit Cooperatives).

The bank shareholders are KCB Group, Cooperative Bank, DTB, HF Group, NCBA, Absa Kenya, Stanbic and Credit Bank. Kenya Women Microfinance Bank (KWFT) is the sole MFB (Micro Finance Bank) shareholder while SACCO shareholders include Kenya Police, Mwalimu National, Safaricom, Ukulima, Bingwa, Imarisha, Unaitas, Imarika, Tower, Stima and Harambee.
Said KMRC’s Ag. Chairman, Dr Haron Sirima, who represents the National Treasury on the board: “Today’s AGM is a key and historic milestone for KMRC. With the facilitation and support of the board, we are now
properly and fully equipped to play our role in revolutionizing the home loans market in Kenya, while making homes affordable for as many of wananchi as possible.”

“From an operational standpoint, I can confirm that everything is now in place for us to start providing long-term finance to participating financial institutions, for onward lending to home loan borrowers at affordable rates,” added KMRC Ag. CEO Johnstone Oltetia.

KMRC was established two years ago to support the Affordable Housing Pillar of President Uhuru Kenyatta’s Agenda Four development blueprint, by providing secure, long term finance to Primary Mortgage Lenders (PMLs), who are then supposed to advance the same to individual borrowers. The idea is to address the shortage of long-term finance in the Kenyan financial market, while addressing the problem of asset maturity mismatch, which is responsible for the high cost and general inaccessibility of home loans to many Kenyans. It also seeks to refinance or purchase eligible home loans and invest in government debt securities or other guaranteed debt.

The AGM comes in the wake of the recent Budget Speech, in which National Treasury and Planning CS Ukur Yatani amplified the critical role KMRC is expected to play in response to the COVID-19 pandemic by “maintaining adequate liquidity among primary mortgage lenders (banks and SACCOs) in order to keep housing finance and the housing market functioning.”
“This will avert potential credit crunch that would hurt lower income households and interrupt efforts to support affordable housing,” said Amb. Yatani. KMRC is also expected to play a key role in the structuring of the proposed National Credit Guarantee Scheme to create “an effective backstop mortgage guarantee component to cover the losses incurred by lenders on future home loans.” The CS further noted that KMRC had already raised Sh2 billion capital from its shareholders, while the National Treasury had mobilized Sh35 billion from development partners for its operations.

KMRC Board Members (l-r) Ms. Sarah Bonaya, Mr. Asman Khatolwa and Ms. Susan Maira at the KMRC Offices in Upperhill after the Annual General Meeting (AGM) held virtually on Tuesday June 30, 2020. This was KMRC’s inaugural AGM since the company’s incorporation in April 2018 and launch in May 2019.