CIRCULAR No. 72 / 2014 18.11.

2014
To All Members,
HOUSING LOAN TO OFFICERS UNDER STAFF HOUSING LOAN SCHEME
Members are aware that we were pursuing with the management for improvement in Housing Loan
to Officers through central MRM, Small Committee Meetings, various letters and also personal
meetings with the top management. We had demanded Maximum loan amount of Rs.50 lacs with
Simple Interest @ 6.5% up to 20 lacs & @ 8% above 20 lacs, Spouse income to be clubbed for
determining eligibility limit, wherever spouse income is considered but recovery of installment to be
done from salary of employee, net take home salary should be 20 % of the monthly gross salary and
not 40% as for sustenance is available from spouse income, Loan for 2nd house within overall proposed
enhanced limit, Repayment of H/L up to 70 years of age as applicable under Public Scheme & Facility
to be given to all confirmed officers as against existing eligibility of minimum 5 years of service.
Now bank has issued circular increasing the housing loan limit for officers from existing Rs.20 lacs to
Rs.40 lacs at 8 % simple interest on the entire amount of Rs.40 lacs. The eligibility period improved to
confirmed employees from the existing period of minimum period of 5 years of service which will
benefit the new recruits. The repayment is permitted up to 240 months or up to the age of 70 years
whichever is earlier, which will benefit officers having lesser number of remaining services.
After issue of the above circular we were receiving various queries regarding the implementation of
the scheme. We have taken up with the management giving our suggestions and justifications on
improvement of the scheme as well as clarifications required for proper implementation of the same
through our letter to GM PAD dated 17.11.2014 which is reproduced for the information of members.
With greetings,

Dilip Saha
General Secretary
“QUOTE”
17.11.2014
The General Manager (PAD)
Punjab National Bank
HO: New Delhi.
Sir,
Reg: Housing Loan to Officers under Staff Housing Loan Scheme.
We have given various suggestions in the small committee meetings held on 26th September 2014 &
9th October 2014 and we are thankful that some of our suggestions like Increase in quantum of loan,
reducing the eligibility period from minimum 5 years to confirmed employees and repayment
permitted up to 70 years have been accepted.

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Registered Office: 306, Kirti Mahal, 19, Rajendra Place, New Delhi – 110008. Fax: 011-25735979
 Since the Circular No.123 issued on 22.10.2014 is very brief, there are confusions on its
implementation which requires clarification to be issued. Further, while clarifying / elaborations on
these issue some of the changes are also required to be made in the present context.
Issues required clarification with amendment are as under:
PRESENT GUIDELINES CHANGES REQUESTED
Additional Housing Loan: This clause should be specifically reiterated since
Conversion of Clause ‘g’ of L & A Circular No. the word ‘one time measure’ in existing circular
120 dated 30.10.2010 has been misinterpreted at various places.
Repayment: In not more than 240 monthly In not more than 300 monthly installments or 70
installments in case of Officers and 300 years of age whichever is earlier in case of Officers
monthly installments in case of Award Staff or as in case of Award Staff.
70 years of age whichever is earlier. The loan
shall be repayable in the ratio of 3:1, principal
being adjusted first in full.
Conversion of Existing Housing loan: If any The facility be allowed to the staff members with
employee has raised Housing Loan at higher clause to reschedule their existing loan with the
rate of interest from PNB or any other condition that total repayment period not
institution, the same may be allowed to be exceeding 300 monthly installments or maximum
converted within the proposed revised limit/ age of 70 years whichever is earlier.
amount of loan admissible.
The repayment period of existing housing loan
under staff scheme may be rescheduled for a
period not exceeding 300 monthly
installments or maximum age of 70 years
whichever is earlier.
Income for repayment of Housing loan: Condition of 60 times of gross salary for
Maximum 60% of total emoluments. calculation of loan amount eligibility as given in
revised guidelines should be
changed/withdrawn, as repayment capacity of
the employee has been already permitted/
Calculation of loan amount: 60 times monthly restricted up to 60% of gross salary including the
gross salary subject to a maximum of 40 lacs. proposed deduction of Housing Loan installment.
Whatever is the eligibility within 60 % deduction
clause should be permitted.
Loan for Repair / Maintenance / Enlargement May be increased to Rs.10.00 lacs as loan
of existing house (applicable where Housing amount is increased from 20 lacs to 40 lacs due
Loan not taken under Housing Loan to increase in cost.
Scheme): Rs.5.00 lacs
Land cost as part of Housing loan: Advance for Land cost may be up to 60% of total cost of the
purchase of the plot alone may be sanctioned house as in case of Housing Finance Scheme for
to the extent of 25% of the eligible loan Public since the cost of land is much higher than
amount. construction cost today.

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Registered Office: 306, Kirti Mahal, 19, Rajendra Place, New Delhi – 110008. Fax: 011-25735979
 Further, we had already discussed in the Small Committee Meeting the following which may be
reconsidered:
Our Suggestions Justification
We had proposed spouse income to be added The concept of concessional rate is applicable only
to arrive at eligibility and since deduction to employees. However, all other scheme details
would take place from the officer employee, as applicable to Public should be made available
such deductions may be allowed up to 80 % of since the proposed loan will always remain
Gross Salary as sustenance will be available secured. Further, proposed or existing rental
from spouse income. income should also be taken into consideration
for determining loan amount and repaying
capacity.
Loan should be extended for purchase of The housing loan given at staff rate is the only
Second House with in the residual entitlement concession whereas the same builds to Bank’s
as is permitted by SBI and other banks. business as Standard Asset. By denying this a
majority of officers are deprived of availing
This may be allowed in the same Municipal
concessional facilities. Moreover, Government of
Limit where earlier house is existing or at any
India has already permitted Banks to formulate
other centre of choice by the officer employee.
own Housing Loan Policy for staff without any pre-
(Prior to enhancement of Housing Loan to
condition.
Rs.7.5 lacs for officers, Second House was
allowed at centre other than where the existing The necessity of larger house / separate second
house is situated but was withdrawn house has become a necessity for the following
subsequently) reasons:
a) Expansion of family where children are
studying /settled at different Centres away
from home.
b) Family members have increased thereby
making the existing house very small to
live but large flats (by disposing the
existing house) not available in the same
locality where as small additional flat is
available in same building / locality.

We request you to kindly consider our suggestions and also issue necessary clarifications to the field
for proper implementation of the scheme.
Thanking you,
Yours sincerely,
Sd/-
Dilip Saha
General Secretary
“UNQUOTE”
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Registered Office: 306, Kirti Mahal, 19, Rajendra Place, New Delhi – 110008. Fax: 011-25735979