AGREEMENT SIGNED ON SECOND TRANCHE OF CREDIT RESOURCES UNDER
GERMAN-ARMENIAN PROGRAM ON DEVELOPMENT OF STABLE HOUSING FNANCING
MARKET IN ARMENIA
YEREVAN, JANUARY 18, NOYAN TAPAN. The Armenian representative of
Kreditenschaft fur Wiederaufbau (KfW) bank (Germany) Karapet Gevorgian
and the chairman of the Central Bank of Armenia (CBA) Tigran Sargsian
on January 18 signed an agreement on provision of the second 6
million-euro tranche of the credit resources under the program on
development of stable housing financing market in Armenia.
To recap, an intergovernmental agreement on provision of credit
resources of 12 million euros by KfW to the CBA was signed between the
governments of Germany and Armenia in March 2006. The allocation of the
first 6 million-euro tranche of these resources started in early 2007.
By late 2007, 343 mortgage credits of the total amount of about 2 bln
40 mln 816.1 thousand drams were given through the program partners: 9
banks and 2 credit institutions of Armenia. Under the program, KfW
provides credit resources to the CBA at a 0.75% interest rate, for a
repayment period of 40 years, including a 10-year grace period.
According to K. Gevorgian, provision of the second tranche will become
possible after the signing and ratification of an interstate agreement
between Germany and Armenia, which will take place no sooner than in
May 2008. In his words, the use of the whole amount of the first
tranche was restrained by considerations of not causing a deficit of
mortgage credit resources provided by financial institutions. The
second tranche is expected to be placed until the end of 2009, after
which it will be possible to ensure the program’s continuity at the
expense of repayment of the credits provided to customers and financial
institutions – partners.
T. Sargsian said that the Armenian-German program on mortgage crediting
has promoted development of the Armenian mortgage market. Among the
program’s goals are the introduction of the "minimal quality
measurements" of mortgage crediting in credit providing institutions
and the creation of prerequisites for developing the secondary mortgage
market in the medium term.