Demand for Mortgages Falls Due to Devaluation

In the first quarter of this year, Azerbaijan Mortgage Fund by the banks - agents issued mortgage loans of 20.7 million manat (minus 24.5% to April 1 last year, when 27.4 million was issued). The reason for the fall in demand is due to real reduction in affordability because of to the devaluation on 21 February.

In March, the AMF agent banks issued mortgage loans worth 6.7 million manat. By 1 April this Fund refinanced loans of 15.4 million manat. According to the Fund, the stock exchange placed bonds worth 3 million manat in Q1.

AMFcreated in December 2005 began to issue mortgage loans in March 2006. Issuance of social mortgage in Azerbaijan was short-lived - from January to July 2007. This segment of the mortgage is financed from the state budget. Its maximum is 50,000 manat at a rate not exceeding 4% per annum.

Mortgage loans on commercial terms are issued in manat and only to citizens of the country. Loans are granted for a period of 3 to 25 years, the maximum loan must not exceed 50 thousand manat at a rate of not more than 8% per annum. --17D-