Loans
Axis Bank offers last 12 EMIs waiver in home loans with 20 year tenor

The 'Happy Ending Home Loan' from Axis Bank offers to waive off last 12 EMIs for tenure of 20 years, but no discounted interest rates are applicable for this scheme

 
Mumbai: Axis Bank, the third largest private sector lender in India, has launched a home loan product with a built-in equated monthly instalments (EMI) waiver scheme under which the bank will write off the last 12 instalments if the customer stays with it for at least 15 years, reports PTI.
 
However, the bank is not offering any discounted interest rates to this product.
 
"The product, called 'Happy Ending Home Loan', is being offered at the same rates as a regular loan and will be applicable to new customers under the floating rate option.
 
The EMI waiver will be offered to all loans with an initial tenure of 20 years or more that cross their 15th year," the bank said in a statement.
 
The new product, available to new customers, offers to waive 12 EMIs or equated monthly instalments for those borrowers with a 15-year or more tenure and if he/she pays the EMIs on time.
 
When contacted, consumer lending & payments head Jairam Sridharan told PTI, "The new product is our way of rewarding customer who pay their EMIs on time." 
 
When asked whether the scheme is open to existing customers, he said it is targeted at the new customers but existing borrowers can avail it provided they go through a process of reapplying for the loan, which would cost them the currently existing processing fee.
 
On the benefit side, Sridharan said for a customer taking a home loan for Rs50 lakh at 11% floating rate, the EMI per lakh of loan size will be Rs1,032. For a customer taking a 'Happy ending home loan,' the EMI waiver will be worth up to Rs6.19 lakh.
 
When asked about the rationale of the scheme, he said customers are increasingly opting for longer-tenure home loans.
 
"Unlike in the past, today more and more home loan borrowers are young and they are opting for 20-25 years tenure with closing the loan at the earliest not being a priority.
 
This is partly due to the high interest rates and high home prices and partly due to the age profile of the new home buyers," Sridharan said.
 
"Any customer, who pays EMIs on time will be automatically eligible for the benefit. As with the standard Axis Bank home loan, the new scheme will come with zero pre-payment penalty, "the bank said.
 
Axis Bank, with 1,674 branches and 10,337 ATMs across 1,080 cities and towns, has doubled its home loan book in the past two years. Its home loan book stood at over Rs30,000 crore at the end of the June quarter, Sridharan said.
 

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NHB may come up with norms on asset-backed securitisation

The National Housing Bank is considering norms that would allow housing finance companies to sell non-real estate loans and guarantees for funding purposes

 
New Delhi: The National Housing Bank (NHB) said it is considering coming out with norms that will allow housing finance companies to sell non-real estate loans and guarantees for funding purposes, reports PTI.
 
"We are also looking at securitising standard portfolios assets which are well known in the industry but the awareness about these assets is underlined and must be promoted amid the investor community," NHB Chairman and Managing Director RV Verma said at an Assocham event.
 
Asset backed securities is an instrument backed by a loan or lease against assets other than real estate.
 
"From the investor point of view, we want to channelise the papers from institutional investors into the market and these investors would include mutual fund, pension, provident fund... we need to channelise long term funding into the mortgage market," he said.
 
"We are taking up the issue with government," he added.
 
Noting that there is deficiency of capital in the housing sector, Verma said that there was need to get capital into the sector through market oriented ways which is possible with securitisation.
 
Further, the NHB chairman said that securitisation would result in capital conservation, capital relief and its optimum utilisation through off-balance sheet transactions.
 
"...the lending sector cannot lend beyond a certain point due to capital constraints and with securitisation they would be enabled to continue to lend and can come over all constraints if they are able to securitise," Verma said.
 

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SEBI restrains D&A Financial from taking up new public offers

In the final order, SEBI upheld its interim order passed against book running lead manager -D&A Financial Services to the public issue of Brooks Laboratories and Dinesh R Kaushik, director of the company

 
Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has restrained merchant banker D&A Financial Services and its director Dinesh Kaushik from taking up new assignments or be involved in new public offers till further orders due to non-compliance with the disclosure norms in Brooks Laboratories' initial public offering (IPO) prospectus, reports PTI.
 
The final order follows an interim order passed on 28 December 2011 after giving an opportunity to these entities to present their case. In the final order, SEBI upheld its interim order passed against book running lead manager -D&A Financial Services Ltd to the public issue of Brooks Laboratories and director of D&A, Dinesh R Kaushik.
 
SEBI through its exparte ad-interim order dated 28 December 2011, restrained the D&A Financial Services and its director from taking up any new assignment or involvement in any new public offer from the securities market till further orders.
 
The regulator said it "confirms the directions issued against D&A Financial Services Ltd and its director Dinesh R Kaushik vide ex-parte ad interim Order dated 28 December 2011 in the matter of Brooks Laboratories." 
 
In its order the regulator, "prohibited D&A Financial Services Ltd and Dinesh R Kaushik, Director of D&A from taking up any new assignment or involvement in any new issue of capital including IPO, follow-on issue, etc from the ecurities market in any manner whatsoever, till further directions." 
 
It further said, D&A was prima facie found to have not made proper disclosure in a timely manner and thereby failed in its responsibility to conduct proper due diligence into the affairs of Brooks.
 

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