PNBHFL to up interest rates

PNB Housing Finance Limited (PNBHFL) is planning to raise interest rates by 50 basis points to 9.75 per cent, managing director V K Khanna said.

The company was considering a rate increase and a formal decision would be taken 'soon'.

It is also redefining its strategy to leapfrog its disbursals and to shore up the position on the non-performing assets front.

He said that the company is looking at tie-ups with builders to be able to act as the preferred financiers of their projects.

"Additionally, we are also looking at increasing our exposure to project finance, so that construction goes on unhindered, creating housing stock speedily," Khanna said.

He said that the company is also looking at slum redevelopment projects as an opportunity. PNBHFL has so far financed one such scheme in central Mumbai where slums were demolished to build two towers.

With the measures planned, the company should be able to add Rs 100 crore to its business and expects disbursal to rise to Rs 700 crore in 2007-08, he said.

(This is an updated version of the story first published on March 13, 2007)