NMRC was designed and set up by DLM to provide long-term financing to commercial and mortgage banks (its clients). It does so by issuing long term bonds of up to 30 years to refinance seasoned mortgages by its clients. DLM is also the appointed Sole Financial Adviser to Nigerian Mortgage Refinance Company (NMRC). In its capacity as Lead Issuing House to the NMRC’s AAA rated N440 Billion Mortgage Pass-through Bond Programme which is guaranteed by the Federal Republic of Nigeria, DLM assists NMRC to raise these funds on a continuous basis and by so doing helps to provide housing support and ownership to Nigerians.
In addition, DLM in conjunction with other stakeholders designed and set up the mortgage Warehouse Funding Limited (“MWFL”), a wholesale aggregation funding vehicle to link mortgage Banks to the Money & Capital Markets. The aim of the vehicle is to provide mortgage banks with sustainable funding that expands their lending and origination capacity, at economically viable costs. The MWFL Program is structured as an Asset Backed Commercial Paper program (“ABCP”) established with an initial issuance capacity of up to N20,000,000,000. It is currently rated A1/S1 short term by both Global Credit Ratings (“GCR”) and Agusto & Co (“Agusto”) respectively.
The subordinated tranche of the issuance programme has its initial subscriber as the Africa Local Currency Bond Fund (“ALCB”) which is managed by Lion Head, an investment banking firm headquartered in London. The subscribers to ALCB are KfW, IFC, and other DFIs. The aim of DLM in setting up and running this funding vehicle is to make it possible for prospective Nigerian home buyers to acquire their much-needed homes.
MWFL issues highly rated senior and subordinated Commercial Papers (“CP or the Notes”) to institutional investors and the proceeds are used to fund loans to Mortgage Banks for the continuous origination of term mortgages of up to 30 years for prospective home buyers. The initial financing mis-match is covered by a Liquidity Asset Purchase Agreement (“LAPA”) entered into between MWFL and the Nigeria Mortgage Refinance Co Plc (“NMRC”).