Affordable HousingAffordable Housing

An International PerspectiveAn International Perspective

Crisis ImpactCrisis Impact Prior to financial crisis, business models followed to reach Prior to financial crisis, business models followed to reach

affordable housing segment performed well in many affordable housing segment performed well in many marketsmarkets

Financial crisis has exposed weakness in some of these Financial crisis has exposed weakness in some of these models, especially NBFIsmodels, especially NBFIs

Exposed NBFIs overly dependent on funding from capital Exposed NBFIs overly dependent on funding from capital markets and highly leveraged.markets and highly leveraged.

However, NBFIs are important to the sectorHowever, NBFIs are important to the sectorFocus on affordable housing marketFocus on affordable housing market

Commercial banks have tended to focus on lending to Commercial banks have tended to focus on lending to businesses, not retail financebusinesses, not retail finance

Some answers??Some answers??

Need a ‘port in a storm’Need a ‘port in a storm’

Match funding and lower leverageMatch funding and lower leverage

Understand which segments are Understand which segments are subsidizing the each other and to subsidizing the each other and to what extend to expose your what extend to expose your vulnerabilitiesvulnerabilities

What is IFC doing in Affordable What is IFC doing in Affordable Housing space?Housing space?

Supporting FIs that have prove their ability Supporting FIs that have prove their ability to navigate in times of crisisto navigate in times of crisis

Promulgating responsible lending and Promulgating responsible lending and international best practices helping our international best practices helping our clients to reach market segment efficiently clients to reach market segment efficiently and prudentlyand prudently

Supporting housing microfinance and Supporting housing microfinance and home improvement lending modelshome improvement lending models