Mortgage program of Azerbaijan's largest bank may expand possibility of buying housing outside Azerbaijan

Business Materials 4 June 2011 13:13 (UTC +04:00)

Azerbaijan, Baku, June 4 /Trend, N.Ismayilova/

The International Bank of Azerbaijan (IBA) is negotiating with the OPIC (Overseas Private Investment Corporation, USA) in order to attract credit line to fund its own mortgage program, IBA Chairman Jahangir Hajiyev told Trend.

"We expect to conclude negotiations by the end of this year and begin the successful implementation of this project from the next year," Hajiyev said.

The IBA plans to attract private U.S. investments in the mortgage financing in Azerbaijan, also considers the possibility of financing the purchase of housing in other countries such as Georgia, where the subsidiary of the bank operates.

Today, negotiations are underway to attract about $100 million. The rate on mortgage loans in the IBA program may be higher than the Azerbaijan Mortgage Fund, since it will be private money. However, the bank is considering ways of attracting money from American investors at lower rates. The amount of mortgage loan under the IBA program will exceed the limit of the AMF in 50,000 manat.

According to Hajiyev, the aggregate borrowing of IBA today totals $1 billion.

IBA ended last year with assets at 5,527.92 million manat, an 8.99 percent increase since 2009.

IBA is a half-state bank and its main shareholder today is the Azerbaijani government, which owns 50.2 percent of the shares. 49.8 percent is owned by private individuals and legal entities (including banks).