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Page 1: I.nhmfc.gov.ph/transparency-seal/ii_annual_report/accomplishment...2 updating of accounts, partnership with banks/payment centers (SM, Bayad Center, e-Payment thru Smart Money), outsourcing

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Highlights of NHMFC Accomplishments for CY 2015

The National Home Mortgage Finance Corporation (NHMFC), one of the key shelter

agencies in the country, is the major secondary government mortgage institution and is mandated

to accelerate the recycling of funds in the housing sector through the purchase of mortgages from

developers, banks and other financial institutions to serve as asset pool for future securitization.

I. Housing Finance Services

Purchase of quality mortgages and other housing receivables under HLRPP

One of the major programs of NHMFC is the Housing Loan Receivables Purchase Program

(HLRPP). Launched in the last quarter of 2010, HLRPP seeks to liquefy asset portfolio of

housing developers and other home financing institutions by purchasing their seasoned housing

loan receivables to form part of the asset pool for securitization.

For 2015, the NHMFC Credit Committee was able to approve ₱708.60 million worth of housing

receivables or 71% of the ₱1.00 billion annual target. The aggressive marketing efforts and

campaigns for the HLRPP, which practically covered all regions nationwide, paid off as the

amount of housing receivables purchased nearly doubled from ₱353.71 million in 2014.

Table 1: Performance Indicators, Targets and Accomplishments of Purchase of HLRPP

The 100% achievement of the target was primarily hindered by macroeconomic conditions (i.e.

low interest rates, market liquidity, banks has a lot of cash), which made HLRPP not attractive to

its target clients. In order to address the problem, NHMFC developed a modified pricing model

that is aligned with other lending institutions to respond to the demands of clients for lower

interest rates. The modified pricing model will be fully implemented in 2016.

For the turnaround time, the NHMFC was able to achieve an average of 21 working days for the

processing of purchase of accounts under the HLRPP. The process already includes the conduct

of due diligence and release of payment.

II. Account/Loan Management

Collection Efficiency Ratio

With a total collection of ₱2,033.72 million, collection efficiency is at 92.44 percent as of end of

December 2015. The continuous collection programs in the restructuring of accounts and

Performance Indicator Target Accomplishment

Value of housing receivables approved by

Credit Committee for purchase ₱1.00B ₱708.60M

Average turnaround time for provision of

housing finance from receipt of complete

documents

Average of 30

working days

Average of 21

working days

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updating of accounts, partnership with banks/payment centers (SM, Bayad Center, e-Payment

thru Smart Money), outsourcing of collection service partners, and borrower’s counseling

contributed to the collection efficiency performance of the Corporation.

Reduction of Non-Performing Loans/Assets

The strong remediation activities conducted by the NHMFC paid off with accomplishments

surpassing the annual targets. The total disposition of acquired assets and decrease in non-

performing loans reached ₱996.21.

Table 3: Performance Indicators, Targets and Accomplishments of

Account/Loan Management

III. Customer/Stakeholders

Provision of new services/engagements

NHMFC is continuously seeking ways to provide fast and quality service to its clientele through

creation of new programs/services that will simplify the transactions of clients with NHMFC. In

2015, the following endeavours were launched with aim of increasing collection performance

and improving the loan profile of accounts, respectively:

e-Payment for Juan and Juana

With the principal objective of providing borrowers with a more convenient and efficient

alternative to pay their monthly amortizations, NHMFC partnered with Smart

Telecommunications. This is in addition to the already existing alternative collecting

partners of NHMFC such as Development Bank of the Philippines, Philippine National

Bank, Banco de Oro, BPI Family Savings Bank, United Coconut Planters Bank,

Shoemart Retail, Inc. and Bayad Center.

Buyer Initiated Disposal of Asset (BIDA)

The BIDA covers the sale by the Corporation of property subject of foreclosure to any

interested buyer, whether in cash or installment basis. The program intends to move

NHMFC’s non-performing assets to become regular accounts.

Performance Indicator Target Accomplishment

Collection Efficiency Ratio 92%

92.44%

(₱2,033.72M of

₱2,200.00M)

Decreasing the value of acquired

assets/non-performing loans (NPLs) ₱770M ₱996.21M

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The NHMFC Board of Directors approved two (2) new products/services in 2015. These

products/services are BIDA-BULTO and Blue Ocean Projects that will be ready for roll-out in

2016.

Table 2: Board Action on NHMFC’s New Products/Services

Product/Service Board Action

BIDA-BULTO Approved per Board Resolution No. 3856 dated June

3, 2015 the Proposed Guidelines for the Buyer-

Initiated Disposal of Assets in Bulk (BIDA-BULTO)

Blue Ocean Projects Noted during the 285th

NHMFC Board Meeting dated

February 5, 2015

BIDA-BULTO

The BIDA-BULTO intends to sell the Corporation’s non-performing assets in bulk.

Blue Ocean Projects

The three (3) innovative products identified under the NHMFC Blue Ocean Projects are:

(1) Issuance of LGU Bonds Compliant with UHDA

NHMFC intends to purchase the socialized housing projects of LGUs and use these

as the asset pool for the issuance of LGU bonds. The developers’ purchase of LGU

bonds will be considered an alternative compliance of Section 18 of UDHA.

(2) Reverse Mortgage: MAginhawang BUhay dahil sa baHay (MABUHAY)

The project is a means to help the senior citizens with limited current income but

have substantial real estate properties to use these properties (house and lot) as a

source of additional income to cover their basic daily living expenses, pay for their

health care, finance their long dreamed and awaited vacation getaway, and other

financial obligations. This allows the senior citizens to enjoy their lifetime savings

without worrying about payments.

(3) Wholesale/Retail Residential Rental Receivables Acquisition Program and Home

Ownership thru Mortgage for Every Filipino (WR4AP-a-HOME)

This product has two (2) possible options for NHMFC. The first option involves the

purchase of residential rental receivables (house rental/rent) at a discount and

pooling of these receivables for eventual transfer to a Real Estate Investment Trust

(REIT). If the lessee and lessor (Primary Parties) would agree, there is another option

for the sale of the property, from the lessor to the lessee. The sale would be financed

by the NHMFC, in partnership with a bank or a financing institution (Partner). After

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the Partner seasons these loans, NHMFC purchases the remaining balance. The

receivables from the mortgage will then be pooled for eventual securitization.

Table 3: Performance Indicators, Targets and Accomplishments of

Provision of New Services/Engagements

IV. General Administrative Services (GAS)

ISO 9001:2008 Quality Management System

In 2015, NHMFC continued its efforts to ensure quality service to its clients. A Quality

Management System (QMS) for NHMFC’s securitization of loan mortgage service was

developed.

For the Customer Satisfaction, the NHMFC was able to achieve satisfactory rating for the quality

of service rendered.

Table 5: Performance Indicators, Targets and Accomplishments of

General Administrative Services (GAS)

Competency Framework

The Competency Framework defines the blue print for excellent performance within an

organization. For 2015, NHMFC was able to establish a competency framework that ensures

effective employee selection, provides measures for performance required to meet organization’s

goals, identifies relevant training for job levels (training needs), and develops employees for the

Succession Plan.

Performance Indicator Target Accomplishment

Number of new products rolled-out and

fully subscribed or new services meeting

target income

At least 2

2

(i.e. e-Payment for Juan

and Juana & BIDA)

Number of new, creative and innovative

products/services/ projects/programs acted

upon by the Board

At least 2

2

(i.e. BIDA-BULTO &

Blue Ocean Projects)

Performance Indicator Target Accomplishment

ISO Certification for all processes

Completed

documenting the

QMS for all

processes

Completed

documenting the

QMS for all process

QMS Manual

Signed

Satisfaction rating from the

borrowers Satisfactory Satisfactory

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Table 6: Performance Indicators, Targets and Accomplishments of

Competency Framework

Information Systems Strategic Plan

The key objective of the NHMFC’s Information Systems Strategic Plan (ISSP) is to develop and

enhance the various application systems of the Corporation to make the systems operational and

responsive to the NHMFC’s requirement. In 2015, eleven (11) systems or 60% of the ISSP were

accepted and implemented as outlined below:

1) Executive Information System (EIS)

2) Liquidity Dash Board

3) Investment and Cash Management System (ICMS)

4) TCT Bilis Release or eMWRF

5) ePayment for Juan and Juana

6) GP – Fixed Assets

7) GP – Cash Flow

8) Document Tracking System (DTS)

9) Disaster Recovery System (DRS)

10) Integration to GP

11) Geographical Management Information System (GMIS)

Table 6: Performance Indicators, Targets and Accomplishments of

Information Systems Strategic Plan

Performance Indicator Target Accomplishment

Competency Framework drafted and

approved

Establish

Competency

Framework

Competency

Framework

Established and

Signed

Performance Indicator Target Accomplishment

% completion of the ISSP 60% 60%