HFC Mortgage & Savings Changes Name

By David Jabati

HFC Mortgage and Savings, Sierra Leone PLC has officially announced a change of name to Commerce and Mortgage Bank (SL) PLC.

This change of name was disclosed to journalists at a press conference held yesterday at the institutions offices on Liverpool Street, Freetown.

Giving a background of the institution, the Managing Director, Ahmed Bakarr Kamara said the National and Insurance Trust (NASSIT) in a bid to provide Sierra Leoneans access to finance for the construction of their homes consulted HFC Bank, Ghana in 2006 to carry out a study on the feasibility of establishing a mortgage finance company in Sierra Leone.

NASSIT, he said, incorporated the company in July 2007, holding 100% of the shares. “Today, it is holding 98% of the shares while the 2% is held by institutional and individual investors,” he informed, adding that, in October 2007 the company was registered to commence business.

He went on to disclose that in August 2009, the Bank of Sierra Leone (BSL) issued a license to provide mortgage loans and accept deposit under the Other Financial Services Act 2001.

“In March 2010 BSL gave us permission to introduce a savings product that operates with cheque book and to participate as sub participant in the central clearing system,” he further informed. This product, he said, attracted new customers, mostly formal employees and businesses and significantly increased the institution’s transaction as its cheques arte now accepted by all banks in the country. “We are already a significant player in the financial intermediation system of the economy,” he boasted.

The Bank, he said, has, as a result of the success of this product, been approached buy many of its mortgage customers requesting that it introduce bond/guarantee and short term lending products on the basis that it already hold their properties as security for mortgage loans. He however stated that the Bank’s license as a mortgage company did not cover bonds, guarantee and short term lending.

“HGowever, we looked into their concerns and realized that the average loan to value (ALV) for equity mortgage loans is 50% therefore additional exposure with regards Advance Payment Guarantees (APG), Performance Bonds and other short term facilities will be adequately covered. This will give our customers flexibility to carry out their businesses and an opportunity to increase our fee income and profitability,” he explained.

It is against this background, he said, they applied for a banking license which was issued by BSL on the 15th of September, 2016 under the provision of the Banking Act to trade as Commerce and Mortgage Bank (SL) PLC.

He said though they will e operating as a commercial bank, mortgage lending will be core product.