Azerbaijan, Baku, 21 August / Trend corr. I.Khalilova / The International Finance Cooperation (IFC) and Azerdemiryolbank, an Azerbaijani bank, signed a $5mln loan contract to finance mortgage operations. The loan is issued for seven-year term.
"This is the second agreement in Azerbaijan on housing financing, which is a main part of the IFC's support to develop private sector in the country," Lars Tunnel, the IFC general executive director and executive vice-president of the World Bank on private sector, said at the signing ceremony in Baku. This project along with ensuring long-term financing, which the banking field needs, will enable to develop primary mortgage market through the improvement of standards of mortgaging up to the level of advanced practice."
According to Tunnel, this amount is designated to solve housing problems of people with low and medium income.
This loan is part of the IFC's $15mln package for Azerdemiryolbank. Loan agreements will be signed within two months on the remained two loan lines to support leasing operations and trade financing at $5mln amount for each, Roman Amirjanov, the president of the bank said.
Azerdemiryolbank cooperates with the IFC since 1998.
This is the second transaction within the framework of the IFC Housing Finance program, which includes ensuring of long-term mortgage financing and rendering consulting services. The first loan was issued to UniBank in the amount of $15mln for seven-year term in March 2008.
Leasing operations are financed within the framework of leasing support program in Azerbaijan and Central Asia. Before the beginning of the IFC program's activity in Azerbaijan in 2005, the main activity of the cooperation was technical assistance in Uni Leasing, AG Leasing and Bank of Baku, although it renders consultations to other leasing companies. Uni Leasing was the first company in Azerbaijan, which got (through its founder UniBank) $5mln loan from the IFC. The second 1$mln loan was issued to AG Leasing (through AzerigazBank).
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