http://abc.az/eng/news/main/39399.html

IFC: Azeri banks not to abandon mortgage market

Baku, Fineko/abc.az. The International Finance Corporation (IFC), two partner banks of which in Azerbaijan have re-oriented its credit lines for mortgage lending for other goals, does not see special tragedy in that.

In the opinion of Viktor Mints, the manager of Corporation’s Azerbaijan and Central Asia Primary Mortgage Market Development Project, the country’s banks will hardly leave the mortgage market.

“It is of no sense taking into account investments made in development of mortgage lending technology and accumulated mortgage portfolio. But suspension of active operations and more thorough risk assessment are possible,” he said.

As well as around the world mortgage loan activity in Azerbaijan experienced outburst in 2007 against the background of mainly groundless rise in real estate prices. Mortgage lending was resumed in the country this year and its rate has already gathered the pace not ceding to mortgage boom of 2007.

The banks with which our Project is co-operating have not lost an interest as well to technical assistance and training courses in the area of mortgage lending,” Mints said.

According to Mints, consultants’ work over the poll will be over within one or two weeks.

“Mortgage market analysis aims concrete goals. With its help we try to clarify demands of potential mortgage loan recipients, their assessment of existing practice, reveal available difficulties. The analysis will become a basis for making decisions on further development of mortgage crediting in Azerbaijan. The Azerbaijan Mortgage Fund under the Central Bank also welcomes these objectives as it is able to make a real picture about real needs of consumers. We hope that our projects will also be drawn to making of proposals for further correction of mortgage practice in the country,” he said.

A poll for gathering of data for analysis of supply at the domestic mortgage market was conducted in Sheki, Mingachevir, Barda, Yevlakh, and Ganja a week ago.

The initially conducted pilot polls on the market research were culled out because of non-conformity to international standards of analysis of supply and offer at the mortgage market.

As a result, the IFC rendered assistance to the consultants in preparation for a new type of reporting and analysis.

The IFC’s contract with IBA was signed for 45 days and with ERA for three months.

ERA was to deal with analysis of supply at the mortgage market and another, IBA Consulting, with analysis of supply.

Primarily 10 companies displayed an interest to analysis of demand at the mortgage market and 9 companies to analysis of supply.

A brief list of the tender participants (by three claimants on each direction) was formed. On 29 June, they submitted final technical and financial bids filled in on the IFC forms.

The survey is conducted to order of the Central Bank and Azerbaijan Mortgage Fund operating under its authority.

The survey will include appraisals of demand and supply at the market of housing real estate, availability of supply and demand for mortgage loans, their terms, etc. The appraisals will be a basis for further steps of the CB and AMF at this market.

Objective of the assignment is to survey the housing market and mortgage lending demand in Azerbaijan.

The consultant can be a firm or a consortium.

Interested consultants must provide information indicating that they are qualified to perform the services (brochures, description of similar assignments, experience in similar conditions, availability of appropriate skills among staff, etc).

It ought to be noted that Azerbaijan’s Azerdeviryolbank and Unibank have re-directed IFC finances for mortgage lending for loaning to small and medium-size businesses.