Economy, Business And Markets

Maskan Gets Capital Raise

Maskan Gets Capital Raise  Maskan Gets Capital Raise

The Minister of Roads and Urban Development Abbas Akhoundi has announced that 50 trillion rials ($1.67 billion) will be injected into Bank Maskan (housing bank) to improve its lending power.

“With the increase in Maskan’s capital, it will become less dependent on the Central Bank of Iran to finance mortgages, construction projects, transportation development and renovation of distressed urban areas,” he said, addressing Maskan’s 77th founding anniversary  this week, IRNA reported.

The bank’s current operating capital is 32 trillion rials ($1 billion).

“I think all banks should be allowed to offer housing loans. But Maskan, as the specialized housing bank, should act as the mortgage market regulator.”

In 2008, the CBI banned all banks and other financial institutions, except Maskan, from providing mortgage. However, the CBI made an exception for the Housing Savings Account’s long-term mortgage which was launched in May, whereby all lenders were allowed to offer housing loans.

Akhoundi hoped the lifting of the sanctions last weekend would lead to the much-needed reforms in the banking industry, especially the lowering of lending rates.”Setting interest rates is a macroeconomic issue; however, we decided to let Maskan offer housing loans at 14% -- the lowest in the country.”

Mohammad Hashem Botshekan, Maskan’s CEO, said his bank has lent 1.5 quadrillion rials ($52 billion) to 11 million applicants since its founding in 1938. “At the moment, Maskan has 14 million clients and has allocated money for 4.5 million loan projects.”

He added that 28,000 applicants have so far registered with the Housing Saving Accounts, totaling 5.5 trillion rials ($182.2 million).  Their loans will be processed from June.

Bank Maskan’s Housing Savings Account -- a loan scheme providing homebuyers with 400 million rials ($13,350) in small towns and 800 million rials ($26,700) in big cities -- and subsidized loans for renovation of residential units are among government plans for stimulating the recession-hit property market. “Maskan is also planning to transform into a development bank, which requires reforms in structure and increase in capital,” the CEO told the meeting.