Baku, Azerbaijan, July 28
By Azad Hasanli - Trend:
The World Bank (WB) proposes to conduct the corporatization of the Azerbaijan Mortgage Fund (AMF) under the Central Bank, Angela Prigozhina, WB Coordinator for Private and Financial Sector in the Southern Caucasus, told Trend.
The corporatization is the transformation of a state company into a joint-stock company in which 100 percent of the shares are state-owned.
"It would be reasonable to corporatize AMF to create an opportunity to evaluate its market value," she sad. "This will expand opportunities to draw more resources. The privatization of the fund seems to be impossible.
"The ownership of such funds may be mixed," she said. "They can be both public and private. In this situation, everything depends on a possibility of the AMF privatization now."
"We believe that now it is not the best time for this," she said. "However, it is necessary to improve the work and expand the Fund's activities."
In general, Azerbaijan Mortgage Fund has quite a lot of opportunities to diversity its resource base as well, she added.
The WB expert said that the volume of mortgage bonds issued by the AMF, as well as the state financing to it within the social mortgage program is small.
"We believe that there are great opportunities to further expand the Fund's activities and to attract new internal and external resources," said Prigozhina.
"We have started to implement a large consulting program jointly with AMF to improve the internal operating procedures and efficiency of the Fund's operation," she added.
As an example Prigozhina mentioned such tools as the mortgage certificate, raising loans from international organizations or other creditors, etc.
She added that the permission from the owner and naturally, the appropriate tools are needed for such operations, as such operations are associated with a different kind of risk and there is a different principle of the cost planning.
"Currently the fund is working with very cheap subsidized resources, which, unfortunately, is not enough for all," said Prigozhina. "There are those who need subsidized and low-cost loans, because otherwise they can't afford it."
"But, given the volume of mortgage lending, on which the commercial banks operate, one can say the population has a desire to buy housing with mortgages, even at high interest rates. In Azerbaijan there are great opportunities for the development of mortgage lending," she added.
Edited by SI