National Housing Bank (NHB)

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National Housing Bank (NHB), a wholly owned subsidiary of Reserve Bank of India (RBI), was set up by an Act of Parliament (National Housing Bank Act) in 1987. NHB is an apex financial institution for housing. It commenced its operations on 9th July 1988.

NHBNHB has been established with an objective to operate as a principal agency to promote housing finance institutions both at local and regional levels and to provide financial and other support incidental to such institutions. The general superintendence, direction and management of the affairs and business of NHB vest, under the Act, in a Board of Directors.

Organisational Structure

NHB is headed by a full time Chairman and Managing Director, supported by Executive Directors, Head of Departments and other Officers under them. A high powered Board of Directors comprising of Directors nominated by the Reserve Bank of India, top Government officials and eminent independent professionals guide the affairs of NHB. NHB’s Head Office is in New Delhi. It has a regional office in Mumbai and Representative offices in Hyderabad, Bengaluru, Chennai, Kolkata, Lucknow, Ahmedabad, Bhopal, Patna, Nagpur and Bhubaneswar.

Objectives

  • To integrate housing finance system with the overall financial system of the country.
  • To provide affordable housing credit.
  • To promote a sound, healthy, viable and cost effective housing finance system to cater to all segments of the population.
  • To regulate and supervise the activities of the housing finance companies.
  •  To promote dedicated housing finance institutions to adequately serve the needs of various regions and different income groups.

Functions

  1. Regulation and Supervision: NHB exercises regulatory and supervisory authority over the Housing Finance Companies (HFCs). These Companies are required to obtain Certificate of Registration (CoR) from NHB for commencing/carrying on the business of a housing finance institution under Section 29 A of the NHB Act; and are required to comply with Directions, Guidelines and other directives issued by NHB. For this, National Housing Bank has been empowered to determine the policy and give directions to the housing finance institutions and their auditors. National Housing Bank supervises the sector through a system of on-site and off-site surveillance.
  2. Promotion and Development: The policies of NHB are directed towards promotion and development of housing finance institutions and the sector in general.
  3. Financing:  Provides housing refinance to a large set of retail institutions like scheduled commercial banks, scheduled state cooperative banks, scheduled urban cooperative banks, specialized housing finance institutions, development banks.  In addition, the Bank has also extended financial support to the housing schemes formulated by Public Housing Agencies.

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