Pool Valuation and Consideration for the Assignment
The consideration for the pool would be aggregate balance principal of the housing loans being acquired recorded as outstanding in books of the HDFC as on that out-off date. However, the NHB would not purchase any overdue EMIs or penal interest/out-of-pocket expense outstanding in the HDFC’s books as on the out-off-date. These amounts, as and when collected from the respective borrowers, would be retained by the HDFC.
Further adjustments In respect of the outstanding principal would need to be made in accordance with the normal method of amortisation adopted by the HDFC. In other words the outstanding principal as or the out-off date would be worked out by adjusting the original loans amount to the extent of the principal component of the EMIs payable up to May 31, 2000. It would also be adjusted for any prepayments received during this period. The HDFC would maintain separate loan account ledgers for each of the loans included in the receivables pool to be securitised for passing the accounting entries.
The proceeds from the issue of Class A PTCs would be utilized to make pan payment of the consideration for purchase of the housing loans. The balance consideration to the HDFC would be by way of allotment of Class B PTCs.