Finance Ministry Allots First Tranche to Azerbaijan Mortgage Fund – Minister
Azerbaijan, Baku, 3 June / Trend corr I. Khalilova/ " Azerbaijan's Ministry of Finance has allotted the first tranche (AZN 10mln) to the Azerbaijan Mortgage Fund (AMF) attached to the National Bank of Azerbaijan (NBA)," Finance Minister Samir Sharifov said on 3 June. AZN 34mln from the public budget are envisaged for this purpose. According to the Minister, the remaining funds will be allocated later.
AMF spends the funds to re-finance the funds which were previously allocated to AMF by its member banks for housing financing.
AMF suspended allocation of mortgage credits in June 2007 and is expected to resume after the Government approved the mortgage crediting commercial practice. In accordance with the new terms, it is expected that mortgage credits, except social mortgage, will be allocated through AMF funds under the interest rate which will not be lower than that of NBA (14%). So far, credits were allotted via AMF at 6-8% interest rate. At present, commercial banks still finance housing purchase from their own mortgage programs (16-18% interest rate).
State budget has allotted AZN 56mln to AMF including recent tranche for mortgage crediting.