FINANCE

Provided by

Interest rate cuts on subsidized housing loans

The Central Bank (BDL) has reduced the interest rates on subsidized housing loans, according to a BDL circular. The interest on loans provided by Banque de l’Habitat (Housing Bank) is to be calculated on the basis of 20 percent of the interest rate on one-year Treasury bills plus 3.45 percent. Loans provided through the Public Corporation for Housing (PCH) are to pay an interest equal to 20 percent of the rate on two-year T-bills plus 1.6 percent. The previous interest rate on both PCH and Housing Bank loans was 5.5 percent. Housing loans provided by commercial banks and that exceed LL800 million ($531,000 at the official exchange rate) will pay an interest rate equivalent to 25 percent of the rate on oneyear T-bills plus 2.5 percent if granted after Feb. 7, 2017. BDL’s decision to cut interest rates on subsidized housing loans follows reductions in deposit rates and lending rates. The move is part of national efforts to reduce the interest cost of public debt and alleviate the debt burden of citizens amid the current economic and financial crisis.

▸ L0220-16

$163 million loan for Housing Bank

The Cabinet has approved, Chairman of the Housing Bank, the new funds will enable the bank to provide around 1,000 loans. The AFESD requires that 80 percent of the loan be earmarked for homebuyers whose family income does not exceed LL6,750,000 per month ($4,500 according to the official exchange rate). The ceiling for these loans is LL300 million ($200,000 at the official rate). A ceiling of LL450 million was set for loans of homebuyers whose family income per month is between LL6,750,000 and LL10 million. The loan was approved in March 2019. “The AFESD is willing to provide the bank with new loans,” according to Sassine. The Housing Bank will provide another 1,000 loans from its own resources, he said. The Housing Bank had obtained a loan of nearly $112 million from the AFESD in 2013.