Accra (Greater Accra) 22 April ?99

The Bank of Ghana (BOG) on Wednesday said it intends to give special attention to the long-term debt market as part of its efforts at deepening the financial market's capacity to meet the needs of its clients.

In this direction, the BOG will continue to lend "strong support" to financial institutions, especially those involved in providing housing units. Dr Kwabena Duffuor, Governor of the Bank of Ghana, said this in a speech read for him by his deputy, Mr Ossei Kuma, at the commissioning of new office premises, "Ebankese", for Home Finance Company in Accra. The BOG recognises housing as a vital sector since besides providing a basic human need, it has multiple benefits for the economy due to its direct linkages to the manufacturing and service sectors. Dr Duffuor said, BOG would help HFC to achieve its aims, adding, that, "this must not be misconstrued". Similar examples of the Federal National Mortgage Corporation in the US and the Chagamas Behrhad in Malaysia attest to how institutions such as HFC could be used to create liquidity for housing finance through the development of long term, mortgage-backed debt instruments. The Governor said although it is disappointed that the traditional banks have a very short-term view of HFC's role, "it is our expectation that as yields on government treasury bills and bonds reduce their incentive to commit resources to the origination, and servicing of mortgages will increase". Home Finance Company (HFC), Ghana's premier mortgage financing institution, was converted to a public limited liability company on October 5, 1994. It commenced business on December 2, 1991 and is listed on the Ghana Stock Exchange with 475 shareholders. HFC offers a wide range of financial and investment services to investors, prospective house-owners, real estate developers and other stakeholders. The company also provides a savings scheme for those in the informal sector towards the purchase of their own houses. Management of the HFC says equity and debt issues have all been over-subscribed. Mrs Stephanie Baeta-Ansah, Managing Director of HFC, described the commissioning as a proud moment for the company, especially since it is a "move from the period when it had its offices scattered in the city".

She said HFC is now a fully-fledged financial institution, after a humble beginning of four mortgages valued at just about 28 million cedis, three shareholders and a stated capital of only 60 million cedis. Mrs Baeta-Ansah said HFC has approved more than 4000 loan applications and disbursed a little over 3,300. She said the size of mortgage portfolios being handled by the company is unprecedented, adding that HFC has proved that sound mortgage banking can be profitable. HFC has been profitable despite public skepticism that prevailed when the company was conceived, she said, assuring that the new business environment will spur them on to expand the business base and become even more profitable. "Our objective is to continue to provide honest, friendly and excellent financial services on a national scale," Mrs Baeta-Ansah added.