Commercial Bank leads home loan market

Commercial Bank of Ceylon has emerged as the biggest supporter of the dreams of home builders in Sri Lanka, achieving market leadership in the ‘home loans’ sector. 

The bank has announced that its home loans portfolio grew to Rs.72.965 billion as at March 31, 2024 and achieved the number one place.

Notably, Commercial Bank is the first private sector bank to become the market leader for home loans in Sri Lanka.
Commenting on this latest milestone, Commercial Bank Deputy General Manager Retail Banking and Marketing Hasrath Munasinghe said, “One of the strongest bonds in banking is the one between home builders and the banks that support their aspirations. This is a key focus area for us and the bank has developed multiple lending options for this segment, generating steady growth in its home loans portfolio despite the challenging economic environment.”

Commercial Bank home loans are available for purchase of bare land, a house, apartment, construction of a house, completion of a partially-built house, renovation of or an extension to an existing house and for settlement of an existing home related loan. Besides its General Home Loans, the bank has a separate loan scheme for first time home buyers and builders as well as Green Home Loans and Foreign Currency Home Loans.

A first in Sri Lanka, Commercial Bank’s ‘First Time Home Buyers & Builders’ scheme offers a free or discounted Decreasing Term Assurance Policy (DTAP) covering the loan, thereby eliminating or reducing the burden of the cost of the loan protection insurance at a time when construction costs are rising. Commercial Bank’s Green Home Loan is another first-of-its-kind product in the market, which enables financing of both Green Building Council certified projects as well as other green initiatives including residential solar installation at the best interest rates coupled with other concessions. 

Commercial Bank also pioneered ‘Flexible Home Loans’ options, which include Residual Home Loans and Step-up Home Loans. These options have been designed for applicants whose repayment capacity is inadequate or exceed 60 percent of the total remuneration, when the monthly instalment is calculated under traditional methods, such as EMI (Equated Method Instalment) and Reducing Balance Methods.

Under Residual Home Loans, customers can repay part of the capital of the loan and postpone the repayment of the balance. As in the case of Step-up Loans, tailor-made, graduated repayment plans are offered, after evaluating the applicant’s present and projected income.

Additionally, the bank offers a five-year grace period for professionals and high-net-worth individuals, where they can pay only the interest during the grace period and thereafter commence the repayment of capital together with interest, under any available method of repayment such as Equated Monthly Instalment, Reducing Balance Method  or Step-up Home Loans, whichever best suits each borrower.