Housing finance firms to raise up to Rs 12,000 crore via RMBS in FY26
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Housing finance companies are expected to raise Rs10,000-12,000 crore in the current financial year through listed residential mortgage-backed securities , structured by RMBS Development Company Ltd, a National Housing Bank-promoted entity similar to the likes of Freddie Mac and Fannie Mae.The fundraising will be done across seven to 10 deals in the current financial year, Sanjay Shukla, managing director of NHB said on Monday. RDCL, which structured one such deal last week, is in talks with a couple of housing finance companies.RDCL, in which NHB holds the largest stake of 39%, started operations in March 2025. In addition to structuring RMBS deals, RDCL's scope of activities involve providing liquidity support and credit enhancement, among others.Shukla was speaking at the sidelines of listing of India's first residential mortgage-backed securities (RMBS). This involved LIC Housing Finance raising Rs1,000 crore last week through pass-through certificates (PTC) maturing in 20 years at a 7.26% coupon, payable monthly. PTCs are debt instruments backed by assets like loans, which in this case was the housing loan portfolio originated by LIC Housing.Securitisation of loan pools is a popular method among non-banking finance companies. But what sets this particular transaction apart is that price discovery was done through the bidding process on National Stock Exchange's electronic bidding platform.'When housing finance companies sell (loan portfolios) to banks at a pre-agreed rate, there is no price discovery. In this structure, there will be price discovery. The bidding will take place on the electronic bidding platform,' Shukla said.M Nagaraju, secretary – department of financial services, said that under such transactions, the cost of borrowing is expected to come down for housing finance companies, which will be passed on to the end borrower. 'Another major benefit will be to get long-term housing loans at a fixed rate.''Once PTCs are made available to retail investors, investment in this instrument is another option, where they can get monthly inflow,' Nagaraju said.In LIC Housing Finance's deal, the PTCs were issued through a special purpose vehicle and are rated AAA(SO) by CRISIL and CARE.Separately, Shukla also said that NHB is planning to raise Rs55,000-Rs60,000 crore through bonds in FY2026 compared with Rs48,000 crore in the previous financial year.
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