Kapital Business Information Center
On June 16, it became known that the Problem Loan Fund (FPC) allocated funds to some banks to refinance mortgages under the state program. Out of 130 billion tenge, 63.2 billion tenge was provided to banks. Funds will soon be allocated to those banks that have signed an agreement with the FPC. Kapital Business Information Center found out which banks have already received funds from the Fund.
The Eurasian Bank, which planned to allocate 2.4 billion tenge for refinancing, concluded an agreement with FPC on June 10. “According to the agreement, the funds from the Fund should be received within 10 working days from the document's signing date,” the bank emphasized.
Zamira Kilibasova, Head of Product Development at ATFBank, confirmed that the bank also signed an agreement with FPC. “Funds from the Fund have already been received. Currently, more than 600 applications for mortgage refinancing under the state program have been accepted,” she clarified.
Bank CenterCredit and Nurbank also signed agreements with FPC. “Funds from the Fund are expected shortly. About 100 borrowers have approached the bank,” noted the Nurbank press service.
“Kaspi bank signed an agreement with FPC on June 18. The funds under this agreement will be received soon. Approximately 50 applications were accepted for consideration under the state program for mortgage refinancing,” the bank emphasized.
Kazkommertsbank announced the signing of a deposit agreement with FPC for placing 38.1 billion tenge in the bank for a period of 20 years. “The received funds will be directed to refinancing the mortgage loan debts of Kazkom, BTA Bank, and BTA Mortgage clients,” informed the financial institution.
On June 16, Kanat Musin, Senior Banker of the ForteBank Problem Loan Recovery Unit, said that the agreement with FPC would be signed next week.
Many bankers contacted by Kapital.kz indicate some difficulties in writing off loans.
In particular, Zamira Kilibasova clarified that the current tax payment procedure complicates the literal implementation of the state mortgage refinancing program in terms of debt forgiveness by banks.
“When forgiving a debt to an individual, the bank incurs tax obligations to include in taxable income provisions previously deducted. The bank has to pay a 10% individual income tax (IIT) from its funds. The bank also pays a 20% corporate income tax from the forgiven amount. The borrower, meanwhile, does not pay any taxes. If the borrower is an individual entrepreneur, the payment of IIT from the forgiven debt amount should be made by the individual entrepreneur themselves. The bank notifies the tax authority about the debt forgiveness on the loan,” she emphasized.
It should be noted that the state program for refinancing mortgage and housing loans was approved in April 2015. In mid-April, the National Bank announced a decision to invest 130 billion tenge into the FPC's capital, which will allocate these funds to banks at 2.99% per annum for a term of 20 years. Through state funds, it was decided to refinance mortgage loans issued from 2004-2009.
Previously, the National Bank emphasized that the mortgage refinancing program aims to reduce the level of “toxic” loans in Kazakhstan, decrease the economy's dollarization, and mitigate social tension risks. As mentioned earlier, within the framework of the state program, borrowers will be able to convert foreign currency loans into tenge and extend the mortgage term to 20 years. The main step the banks agreed to take is to refuse to collect debt from borrowers on fees, rewards, penalties. Problematic mortgage holders will only pay the principal at 3% per annum.
The state has identified 9 banks that can refinance mortgages under the state program. Kazkom is expected to be allocated 38.1 billion tenge, Halyk Bank – 33.6 billion tenge, ForteBank – 20.3 billion tenge, Bank CenterCredit – 15.6 billion tenge, ATFBank – 9.5 billion tenge, Kaspi bank – 5.3 billion tenge, Tsessnabank – 3.6 billion tenge, Eurasian Bank – 2.4 billion tenge, Nurbank – 1.6 billion tenge.