Islamabad: On Tuesday, the Federal Cabinet’s Economic Coordination Committee (ECC) approved the establishment of a $85 million Credit Guarantee Trust Fund, supported by the World Bank, through the Second Supplemental Trust Deed for low-income housing (Mera Pakistan Mera Ghar). (Reported by news source)
To offer medium and long-term funding to primary mortgage lenders by raising from the capital debt market at more affordable rates, the Pakistan Mortgage Refinance Company Limited (PMRC) was established as a collaborative initiative of the government of Pakistan and Development Finance Institutions (DFIs).
Under the First Supplemental Trust Deed, PMRC, acting as trustee, introduced the Credit Guarantee Trust Scheme.
As a trustee of the Fund under the new plan, the Pakistan Mortgage Refinance Company Limited (PMRC) will receive 0.25 of the premiums that financial institutions pay for the coverage of their portfolios.
Initially providing a background arrangement of Rs. 7 billion, the Pakistani government has pledged to expand it to Rs. 30 billion if necessary, depending on the Oversight Committee’s recommendations.
