Circulars/Notifications / Infrastructure, Housing & SME Finance Department  

 IH&SMEFD Circular No. 04 of 2021
April 01, 2021

The Presidents/Chief Executives
All Banks/DFIs

Dear Sir(s)/Madam(s),

Mandatory Targets for Housing and Construction Finance

  1.        Please refer to IH&SMEFD Circular No. 10 of July 15, 2020 whereby banks and DFIs were advised to achieve mandatory financing targets for housing and construction of buildings (Residential and Non-Residential) equivalent to at least 5 percent of their domestic private sector advances by December 31, 2021.

    2. In order to increase funding for housing and construction through capital markets and microfinance banks (MFBs), State Bank has decided to allow counting of following exposures of banks/DFIs towards achievement of their housing & construction finance mandatory targets:

  1. Direct financing to/or investments in bonds/TFCs/Sukuk issued by Real Estate Investment Trusts (REITs) Management Companies.
  2. Investments in units/shares issued by Real Estate Investment Trusts (REITs) subject to compliance with all other applicable regulations.
  3. Investment in Sukuk/bonds issued by Pakistan Mortgage Refinance Company (PMRC), however, investment in PMRC’s Sukuk/bonds and amount of refinancing availed from PMRC shall be netted off towards counting the mandatory target.
  4. Financing to MFBs for extending housing finance to eligible borrowers to the extent of actual disbursements by MFBs. Banks extending financing to MFBs for housing finance will have to report such transactions to SBP separately.

    3. However, the above exposures will be considered on aggregate basis up-to a maximum of 15% of mandatory targets for housing and construction finance of a bank/ DFI on a given date.

    4. Please acknowledge receipt.

Sincerely yours,


(Dr. Mian Farooq Haq)


About SBP
Economic Data
Press Releases
Laws & Regulations
Monetary Policy
Help Desk
SBP Videos
SBP Welfare Trust
Contact us
What's New?
Online Tenders
Web Links

Educational Resources
Regulatory Returns
Rupey ko Pehchano
Zahid Husain Memorial Lecture
Best view Screen Resolution : 1024 * 768
Copyright © 2016. All Rights Reserved.