October 19, 2007/ Guardian

The Federal Government has said it will soon float a Mortgage Backed Bonds (MBBs) in all the 36 states of the federation as done in the Federal Capital Territory just as the first phase of it hit N26 billion in June this year.

The Minister of Environment, Housing and Urban Development, Architect Tayo Alao gave the hint on Wednesday in

Abuja at this year 2nd Emerging Urban Africa International Conference and Exhibition in Abuja.

The minister who was represented by the Permanent Secretary of the ministry said this was to consolidate on the progress recorded in the restructuring and repositioning key institutions for efficient housing and infrastructure delivery.

She said: \"In our resolve to facilitate homeownership, the Federal Mortgage Bank of Nigeria (FMBN) was recapitalised to the tune of N5 billion...We intend to replicate the N100 billion Mortgage Backed Bonds on the capital market in all the 36 states as was done in the FCT.\"

She said the bond would finance the sale of the 30,000 non-essential houses sold to civil servants under mortgage arrangement in the Territory.

Besides, the National Housing Funds, she disclosed was being overhauled to make it more effective in the housing delivery process, adding that additional 89 per cent rise in the number of contributors from 1.8 to 3.6 million in 2006 with 124 per cent growth in the fund collection from less than N10.6 billion in 2002 to N23 billion in 2006.

However, the legal and regulatory framework to enhance a greater performance in the sector, she revealed that eight housing related laws are before the National Assembly including replacement Acts of FMBN Act 1977; the NHF Act 1992; the Mortgage Institutions Act 1989; and amendment of five others, the Social Insurance Trust Fund Act 1983; Investment and Security Act 1999; Trustees Investment Act 1962; Insurance Act 2002 and the Land Use Act 1978.

These Acts are meant to either facilitate operations in the mortgage finance with additional intended draft laws on securitisation and foreclosure.

She said: \"We are indeed determined to put in place an enduring mortgage finance mechanism to boost the steady flow of funds into the mortgage sector.\"

The minister explained that the government is not ignorant of the constraints faced by the urban poor desiring to own their individual houses, adding that complete houses available through mortgage finance are beyond the reach of the lower income group due to the deposit and income criteria set by the financial institution.

She said the ministry will between November 6 and 7th, 2007 host National Land Reform Conference in Abuja to examine the crucial aspects of land issues for housing development, adding that this would lead to the development of National Land Reform Policy for Nigeria as part of the President seven point agenda.