The National Housing Corporation (NHC) has asked the Treasury for permission to borrow funds from either the Exchequer or external sources, with its revalued asset base as collateral.
Chairman Francis Mungai was speaking while presenting a dividend cheque of Sh23.7 million to Treasury secretary Henry Rotich Wednesday.
The housing corporation, which has paid Sh1.4 billion in dividend to the government since 2004, posted a Sh338.9 million profit for the 2015/16 fiscal year.
“Some time in 2003 there was some Sh4.8 billion that was allocated to NHC, out of which we received 1.6 billion. We are requesting for release of the remaining Sh3.18 billion to enable us achieve our targets,” Mungai said at a press briefing.
“We are also requesting you allow us to borrow... We believe we can revamp our assets by going to the market.”
NHC said a revaluation of its assets showed its asset base stood at Sh20 billion. It plans to use this financial muscles to borrow from the local financial market via a bond.
Last year, the State firm was preparing to issue a Sh5 billion bond to boost its house construction. It had fixed the issue for last June.
“They can go to a financier and use the balance sheet to get funding,” James Macharia Transport, Infrastructure, Housing and Urban Development secretary, suggested, adding the State was looking to change legislation to allow pension funds to invest more in housing.
Mr Macharia said the government had reviewed its five-year housing target from 500,000 to 1 million. Kenya has a housing deficit of about 1.58 million units.