Partial Loan Guarantee In "First House" Proj To Trigger Lower Interest RatesPublish date: Astazi, 27-05-2009
The partial guaranteeing of the loan through the "First House" project will lead to lower interest rates, but it depends on each bank, while the biggest impact as regards lending will be seen at euro-denominated loans, Alpha Bank president Sergiu Oprescu said Tuesday.
As for the household lending norms, Oprescu said he expects the central bank would also intervene.
"For instance, the norm stipulating that the value of the installment in the monthly income is of 50% should be changed," Oprescu said after a meeting between bank representatives and the Finance Minister.
Banks will come up by Thursday with proposals on the "First House" project.
The Romanian Government announced Wednesday a program to guarantee the loans contracted for the purchase of the first home, within the maximum limit of EUR60,000, with the entire financing granted to this program reaching EUR1 billion.
Pogea said the main condition was minimizing financing costs, refusing to provide further details before the three partners, the government, the banks and the Credit Guarantee Fund For SMEs would reach a final conclusion.
The Minister for Small- and Medium-Sized Enterprises Constantin Nita said Tuesday that the "First House" project will be applied for a four-year period and will support the construction of around 50,000 dwellings.
Radu Ghetea, the president of Romanian Banks Association ARB said Tuesday that the National Bank of Romania should amend the household lending norms in order to resume the financing on this market segment, keeping in mind also the government's "First House" program.
Ghetea appreciated the government's initiative, but stressed upon the need of talks on a clear normative act and upon analyzing the way in which the current norms of the central bank are suiting such guarantee.
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