The demand for housing finance is continuously growing in the country due to the growth in population. Housing finance is now playing a vital role in providing loans to people of lower and middle class. This demand is mostly due to the trend towards single family system.

Mr Haq stated at the beginning of the interview that IHFL basically provides facilities for alterations, improvements, extensions and renovation of houses. Besides this, the company is also involved in extending financial facilities for purchase, refinance and construction of residential houses in the country.

Speaking about the history of IHFL, he said that the company was incorporated on July 11, 1990 as a public limited company under the Companies Ordinance 1984. The registrar joint stock of companies granted certificate of commencement of business to IHFL on August 4, 1993. After receiving the license from the Ministry of Finance, the company commenced commercial operations on October 1, 1993.

The company was jointly established by the following: Commonwealth Development Corporation (CDC), UK; International Finance Corporation (IFC), USA; Crescent Investment Bank Limited (CIB), and Pakistan Industrial Credit and Investment Corporation Limited (PICIC). However, PICIC sold its equity in IHFL to Crescent Group. These renowned international and national institutions have contributed their resources, expertise, experience and know how to make IHFL a successful and pioneer finance institution in the country.

Figures of IHFL show that up till April 30, 2004, the company has disbursed an amount of Rs925 million as housing loans to 950 satisfied customers. This means that on average the company has distributed about Rs950,000 per customer. Moreover, an amount of Rs100 million is in the process of approval for disbursement to various prospective customers.

Speaking about the financial performance of the company, he said that IHFL suffered huge losses in pre-operating expenses due to delay in the commencement of commercial operations. However, by adopting aggressive marketing and strategic planning techniques, the company managed to turn around from losses to making profits in the past financial years from 1994 to 2003.

With regards to the financial restructuring of IHFL, he said that some major changes have taken place in share holding and paid-up capital structure, and the company has embarked on a capitalisation program. In the first phase of this program, Packages Group, Dawood, Descon Companies and some strong individual investors have subscribed to Rs7.5 million ordinary shares at a price of Rs12.50 per share. Now IHFL boasts of a very strong group of sponsors including Crescent Group, Packages Group and Dawood Descon Companies, and its paid-up capital has therefore increased from Rs125 million to Rs200 million.

Speaking about the future demands of housing units and housing finance in the country, he said that house ownership in most of the urban areas is about 30 per cent, which shows a huge potential for growth in this sector. In addition, there is also exists a large market for mortgage credit and the estimated demand in the sector is Rs6 billion annually.

On the aims and objectives of the company, he said that the prices in the property market are stable and his company is competing actively with other financial institutions including large commercial banks. The company is targeting those segments where these commercial banks are not active. He further said that his company is also targeting large corporations and offering tailor made facilities to their employees.

Continuing with his interview, he stated that IHFL is in the process of continuously developing its products through innovative schemes and incentives, which are based on the principles of product differentiation. The company gives emphasis to those products, which are not offered by the competitors. For instance, the company developed a scheme for non-resident Pakistanis (NRPs) who are always interested to buy property in Pakistan. To create awareness among the NRPs, the company has planned to advertise in Gulf News and Khaleej Times, Dubai and Arab News, Saudi Arabia.

Talking about another scheme he said that is company is offering corporate loans (CLs), under which contracts have been made to offer loans to employees of well-established organisations. The employees of all universities and corporate bodies can utilise these loans to purchase or construct property. These loans would be provided to individual employees nominated by a company with the company's guarantee.