SRC, Public Pension Agency sign SAR 3 bln portfolio acquisition deal

Saudi Real Estate Refinance Company (SRC), a subsidiary of Public Investment Fund (PIF), signed an agreement with the Public Pension Agency (PPA) to acquire mortgage portfolio worth more than SAR 3 billion.
 

The deal is the largest ever housing real estate refinancing transaction in the Kingdom, the company said in a statement on Sunday.

“The landmark transaction with SRC facilitates the achievement of the Masakin Programme’s strategic objectives, as well as shows our commitment to the citizens by being innovative and ensuring that homeownership rates in the Kingdom is improved to support the Vision 2030.

This agreement will help the liquidity in the market and help us provide more mortgages to people to buy homes,” said Mohammed Al Nahhas, governor of PPA. 

The agreement represents a significant portion of the Masakin Programme, a PPA sponsored initiative that provides fixed-rate Murabaha home financing solutions to employees and pensioners from PPA and the General Organisation for Social Insurance (GOSI), to encourage homeownership in the Kingdom.

The Masakin Programme has contributed to the financing of over 9,000 contracts during the last decade, the governor added.

The deal provides liquidity to the real estate financing market, which in turn is expected to bring lower prices and increase the number of mortgage originations, leading to SRC’s goal of improving homeownership rates in the Kingdom, noted Fabrice Susini, CEO of SRC.

SRC aims to deploy more than SAR 20 billion, primarily through purchasing mortgage portfolios, to refinance 10% of the home loans this year, the statement noted.