Housing Development Finance Corporation

[br] Housing Development Finance Corporation (HDFC) was established in 1977 to provide long term loans at easy rates and for meeting growing housing needs of Indians. HDFC as per 2008 Forbes Global 2000 list occupies 949th place.

[br] Housing Development Finance Corporation (HDFC) was established in 1977 to provide long term loans at easy rates and for meeting growing housing needs of Indians. HDFC as per 2008 Forbes Global 2000 list occupies 949th place.

HDFC’s main objective is to increase stock of residential houses in India through provision of housing loans in a professional and systematic method. Another concurrent objective is to channelize resources into housing finance segment and integrate same with aggregate domestic money market.

Brief history

Housing Development Finance Corporation was established in 1977 for addressing growing demand for residential houses. Initial share capital required for promoting HDFC amounted to INR 100 million. In 1980, International Finance Corporation under an investment agreement disbursed US $1 million out of a total credit of US $4 million. HDFC came out with its first rights issue in 1987. During 9th five year plan, for 1997-2002, National Housing Policy fixed an investment target of INR 1500 billion for housing sector.

Product and services

Products and services offered by HDFC are based on its objectives:

i)Maintain its position as a premier housing finance body in India;
ii)Transform ideas into workable solutions;
iii)Foster a close relationship with individual clients;
iv)Growth through diversification; and
v)Offer increasing returns to shareholders.

In addition to home building loans, HDFC also offers home extension, home improvement and home conversion loans. It also helps to identify and value properties. HDFC also offers depository services in form of term deposits.

Financials

HDFC – Housing achieved sales of nearly US $1.49 billion and profit of about US $ 0.4 billion as on March 2008. Corresponding asset worth was around US $16.97 billion. [br]

Awards and recognition

Goldman Sachs has listed HDFC as one among top 7 financial services organization in 2008. HDFC was awarded a rating of 4 out of 5 in Karmayog’s ‘Corporate Social Responsibility Ratings’ in 2007. In same year, Dun & Bradstreet – American Express selected HDFC as a topper in Indian financial services sector.

Current financial crisis

Current global financial crisis might have an indirect effect on HDFC in form of increase in home loan lending rates.