Finance

8 Functions Of The Federal Mortgage Bank Of Nigeria

The Federal Mortgage Bank of Nigeria was actually established with a number of functions assigned to it, and the most fundamental among these functions, was that of addressing housing challenges in the country, as well as, meeting the housing needs of all Nigerian citizens.
It is a pity however, that most Nigerian citizens do not know much about what led to the establishment of the Federal Mortgage Bank in Nigeria, lest alone, the functions of the Federal Mortgage Bank of Nigeria.
Interestingly, the purpose of the establishment of the Federal Mortgage Bank of Nigeria was to serve the generality of Nigerian public, but it is also unfortunate that, Nigerians have not been benefiting from this government gesture, as well as, enjoying the services of the Federal Mortgage Bank of Nigeria. The reason is obvious.
8 Functions Of The Federal Mortgage Bank Of Nigeria
The Federal Mortgage Bank Of Nigeria – Photo Source: https://www.proshareng.com
It is because Nigerians are not enlightened about the functions of the Federal Mortgage Bank of Nigeria and what they could stand to benefit.
Nevertheless, among the mortgage banks in Nigeria,  the Federal Mortgage Bank of Nigeria is considered, the apex mortgage bank in the country.
The bank was established in 1956. By that time, the Federal Mortgage Bank of Nigeria was known and called, the Nigeria Building Society NBS, which was of course, a joint venture of the  Government of the Federal Republic of Nigeria and that of Eastern Governments of Nigeria, including the Commonwealth Development Corporation.
The Federal Mortgage Bank of Nigeria took on its current name in 1973 immediately the government of the federation, through indigenization Act, had taken full control of the then National Building Society.

What Are The Functions Of The Federal Mortgage Bank?

The Federal Mortgage Bank of Nigeria was established with a view to perform some specific functions that will help it actualized its mandate, and in this article, I will be sharing with us some of the important functions of the federal Mortgage Bank of Nigeria, and here are there:

The Federal Mortgage Bank Provides Long Term Credit Services

The key function of the Federal Mortgage Bank of Nigeria is in the area of providing long term credit services to other mortgage banks all over Nigeria.
The provision of credit facilities to other mortgage institutions in the country, and all the mortgage banks in Nigeria, is very necessary and important, because through such credit services by the Federal Mortgage Bank of Nigeria, other beneficial mortgage institutions would be buoyant financially to give loans to members of the public, who desired to own their houses.
The long term credit loan offered to mortgage banks in Nigeria must be at rates that will make it possible for these banks to give out loans to the Nigerian public.

The Federal Mortgage Bank Encourages Establishment And Development Of Mortgage Institutions

Promotion of the establishment  of mortgage banks and mortgage institutions in Nigeria remained one of the functions of the Federal Mortgage Bank of Nigeria.
What the Federal Mortgage Bank does is to encourage the establishment of these mortgage banks and institutions, as well as, promote the development of these banks and mortgage institutions in Nigeria.
And this is done at the federal government level and state government level and local government level, even in the rural areas.

The Federal Mortgage Bank Encourages Growth Of Mortgage Banks:

The Federal Mortgage Bank of Nigeria encouraged the growth of mortgage banks and mortgage institutions in Nigeria.
Lasting growth of the secondary mortgage banks in Nigeria is very important for the Federal Mortgage Bank of Nigeria, therefore, the Federal Mortgage Bank of Nigeria must encourage these mortgage institutions with a view to make sure that, the required housing needs in the country are met.

The Federal Mortgage Bank Issues Licenses To Secondary Mortgage Institutions

The Federal Mortgage Bank of Nigeria issues licenses to the secondary mortgage institutions and mortgage banks in the country.
So one of the fundamental functions of the Federal Mortgage Bank of Nigeria is to ensure that, it issued licensing authority for every secondary mortgage bank and mortgage institution in the country.

The Federal Mortgage Bank Monitors And Regulates Mortgage Banks’ Activities

Another function of the Federal Mortgage Bank of Nigeria is to monitor the activities of mortgage banks in Nigeria and that of the mortgage institutions across the country.
Being an apex mortgage house in the country, the Federal Mortgage Bank of Nigeria also saddled with the responsibility of regulating the activities of these mortgage financial houses in Nigeria.
So regulating the operations of mortgage banks in Nigeria is solely in the hands of the Federal Mortgage Bank of Nigeria.

The Federal Mortgage Bank Collects National Housing Funds And Manages Same:

Another function of the Federal Mortgage Bank of Nigeria is the collection and the management of the national housing funds in Nigeria.
So what the Federal Mortgage Bank of Nigeria does is first and foremost, it has to collect the national housing funds, and then, make sure that, the funds are well managed in accordance with the provision as provided in the national housing fund Act.

The Federal Mortgage Bank Mobilizes Domestic And Foreign Funds Into Housing Secto

The Federal Mortgage Bank of Nigeria function has also include, the mobilization of funds for the purpose of carrying out its functions effectively.
One of the ways the Federal Mortgage Bank of Nigeria mobilizes its funds to carry out its functions is through domestic and foreign funds mobilization.
So it will mobilized funds from the two sources, the domestic and the foreign sources into the housing sector in Nigeria.
And the mobilization of these funds have been made possible through two markets link, that is, the mortgage market and that of the capital market.

The Federal Mortgage Bank Partners Other Mortgage Institutions:

The Federal Mortgage Bank of Nigeria partners other mortgage institutions in the country. For instance, presently, the Federal Mortgage Bank of Nigeria is in partnership with other mortgage institutions and mortgage banks in Nigeria, particularly with those of the financial and technical capacity.
These mortgage institutions are those ones, that are interested in the delivery of housing that are affordable to the members of the public, who earned medium and low income.

Conclusion

The purpose of the establishment of the Federal Mortgage Bank of Nigeria was to serve the generality of Nigerian public, but it is also unfortunate that, Nigerians have not been benefiting from this government gesture, as well as, enjoying the services of the Federal Mortgage Bank of Nigeria.

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Joseph Athanasius

Joseph Athanasius is a Content Developer at InfoGuideNIgeria.com. InfoGuide Nigeria is a team of Resource Persons and Consultants led by Ifiokobong Ibanga. Page maintained by Ifiokobong Ibanga. If you need a personal assistance on this topic, kindly contact us.

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