MANILA – Sri Lankans living in post-conflict and tsunami-hit areas will soon have better access to badly needed housing loans, after the Asian Development Bank (ADB) approved a $15 million loan to DFCC Vardhana Bank (DVB) to re-lend exclusively for home purchase or rehabilitation. “In order to properly rebuild their lives, Sri Lankans affected by [...]

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ADB to help underserved Sri Lankans access housing loans

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MANILA – Sri Lankans living in post-conflict and tsunami-hit areas will soon have better access to badly needed housing loans, after the Asian Development Bank (ADB) approved a $15 million loan to DFCC Vardhana Bank (DVB) to re-lend exclusively for home purchase or rehabilitation.

“In order to properly rebuild their lives, Sri Lankans affected by conflict or natural disasters need fair and secure access to home loans,” said Philip Erquiaga, Director General of ADB’s Private Sector Operations Department in a media statement issued this week by the ADB. “A well-functioning mortgage system with greater commercial bank participation will help reach these often underserved borrowers and help close the market gap.”

This is ADB’s first private sector housing finance project in Sri Lanka and is expected to help close the country’s housing shortage, which is estimated at between 350,000 and 1 million units, with an additional demand for about 100,000 units every year.

DVB is a medium-sized bank that has a niche strategy to serve the underserved segments of the market. Despite its size, its credit standing is close to or at par with some of the larger Sri Lankan commercial banks. At the end of December 2011, DVB had a 1.3% market share of total banking loans in Sri Lanka, the statement said.




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