THE RESULTS OF THE MCGF ACTIVITY FOR 2019

The reforms carried out in Azerbaijan in 2019 have fundamentally changed political, as well as socio-economic scene of the country. Since the main part of the reforms serves to improve social conditions and welfare of population, steps took on this direction reflected in activity of Mortgage and Credit Guarantee Fund of the Republic of Azerbaijan as well. So, significant decisions have been made not only on improving housing conditions of population and increasing the access to finance for entrepreneurs, but also on general activity of the Fund. 

Over the last year, the Fund has successfully continued its activity in the direction of long-term mortgage lending. So, in 2019, the authorized banks received 7096 inquiries with the total amount of AZN 503 million and provided 2652 mortgage loans (1390 preferential loans) of AZN 174 million. Also, 3398 loans with the total amount of AZN 226,5 million have been refinanced by the Fund. 

Generally, during 2006-2019, 27883 families have improved their housing conditions at the expense of mortgage loans amounted AZN 1,391 billion. Over AZN 436 million (8839 loans) of these loans provided for families belonging to preferential category. 

At the same time, in 2019, the President of the Republic of Azerbaijan confirmed the Decree “On creating rent-to-own mechanism of residential areas”. Over the past period housing stock has already been founded, necessary procedures and rules have been developed, requirements for tenants and residential areas defined within the mechanism. For transparency and operativity all the services will have been submitted in ASAN Service Centers.

During the reporting period, significant measures has been taken in the direction of improving and stimulating of mechanism of providing guarantees and interest subsidies for business loans by the Fund. In result, last year the amount of guarantee granted loans reached AZN 15,195 million increasing by 3 times compared to a year earlier. Generally, at the expense of the mechanism, the entrepreneurs have been received loans up to AZN 70 million so far.

Besides, for the wide realization of information technologies, escalating service level for mortgage borrowers and improving mortgage lending mechanism according to international standards, the Fund has begun to receive payments on mortgage loans (annuity, insurance and mortgage guarantee costs) via “ASAN Payment” system as well since 2019.

During 2019, mortgage bonds amounted AZN 150 million have been placed with 3% interest rate by the Fund. From May, 2009 the funds attracted from internal capital markets by placing securities by the Fund equaled AZN 1,005 billion and directed for financing mortgage loans. 

Last year is considered as successful financial year for the Fund. So, in comparison with 2018, total assets of the Fund increased by 10,2% to AZN 1,41 billion, the profit totaled AZN 18,6 million. 

According to the t Decree by the President of the Republic of Azerbaijan dated December 6, the share capital of the Fund grew by AZN 637 million in 2019. The capital increase will be provided at the expense of AZN 71 million considered in state budget expenditures for preferential mortgage lending.