India Lists its first mortgage-backed, Pass Through Certificates
On 5th of May 2025, Ministry of Finance listed India’s first Mortgage backed Pass Through Certificates (PTC) structured by RMBS Development Company Limited on the National stock Exchange. The listing ceremony was attended by several Heads of Banks, Housing Finance Companies and other financial institutions.
- The issue was for ₹1,000 crores being 1 Lakh certificates with face value of ₹ 1,00,000 each and it was fully subscribed.
- These PTCs are backed by pool of housing loans originated by LIC Housing Finance Limited.
- This is the first issue of PTCs to be on Electronic Book Provider platform of the National Stock Exchange.
- Final maturity date of the PTC issued will be nearly 20 years and
- The instrument's annual coupon rate is 7.26% .
- Rating of the Instrument is AAA(SO) by CRISIL and CARE Ratings.
- These are issued in demat form and are transferable. As they are listed on a stock exchange, these PTC instruments can be traded in the secondary market.
Speaking on the occasion, Shri Nagaraju, Secretary, Department of Financial Services, MoF, stressed the importance of housing sector and the housing finance sector for the growth of our economy. He stated that housing finance has many forward and backward linkages with many other industries including the infrastructure.
He stated that securitization can act an integrating factor for housing finance market and the debt market.
Explanatory note on RMBS:
RMBS Development Company Limited (RDCL), a non-banking financial company, is a middle-layer intermediary, focused on developing the residential mortgage-backed securitization (RMBS) market in India. RDCL was established by National Housing Bank a statutory body under GOI. NHB is RDCL's single largest shareholder and is supported by a strong mix of investor classes across Banks, HFC/ NBFC and Insurance company.