CAIRO: The Central Bank of Egypt (CBE) intends to launch a second 10 billion EGP ($1.3 billion) installment of its mortgage initiative within 12 months, Deputy CBE governor Tarek Fayed said Tuesday.
The first installment was launched in February 2013 to stimulate the mortgage sector. The CBE’s initiative was intended to provide chances to low and average-income individuals to acquire housing units under the Mortgage Finance Fund regulations, at 7 and 8 percent interest, respectively.
Speaking at the “Mortgage Development Partners” conference held Tuesday, Fayed said, “the central bank along with the competent bodies always seek to figure out problems hindering the mortgage sector.”
“The CBE also coordinates with the Housing Ministry and the Mortgage Finance Fund to ease procedures of mortgage,” Fayed stated, adding that the CBE has also urged all banks expand into mortgage finance.
Mortgage firms have doubled the funds directed to the real estate sector to 270.4 million EGP in the first quarter of 2015, compared to 126.5 million EGP in the same period last year.
Fayed further stated that the CBE follows up the mortgage initiative implementation during regular meetings with top banks officials maximize benefits.
“The central bank is giving priority to bolstering real estate finance which is a main contributor to its economic growth, affecting roughly 70 industries,” Fayed stated.
Meanwhile, the funds allocated to the real estate sector, that range between 10 billion and 12 billion EGP, do not match the market valued at a trillion EGP, according to Fayed.
The total portfolio of mortgage firms in the Egyptian market is estimated at 2.5 billion EGP ($327.65 million,) head of the Egyptian Financial Supervisory Authority (EFSA) Sherif Sami revealed Tuesday, a figure described by Egypt’s Investment Minister Ashraf Salmal as “disappointing.”