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EBRD helps boost Serbian mortgage market
Hundreds to benefit from €10 million loan to HVB Bank Serbia & Montenegro
Serbia’s mortgage market is set to expand and become more competitive
following a €10 million loan from the EBRD to HVB Bank Serbia & Montenegro,
one of the country’s leading commercial banks.
HVB Bank Serbia & Montenegro will use the loan to on-lend to new or existing
clients wishing to buy, build or renovate their homes. Hundreds of people are
expected to benefit. Under a similar EBRD loan extended to the bank in 2004,
more than 335 clients received mortgages from the bank.
While Serbia’s mortgage market has grown rapidly over recent years, the sector
is still significantly under-developed, accounting for less than 2 per cent of
the country’s gross domestic product.
There is clearly a large potential for developing the mortgage market in
Serbia, said Jean-Marc Peterschmitt, Director for Bank Relationships at the
EBRD. The EBRD is working with local banks like HVB Bank Serbia & Montenegro
to help many people across the country realise their dreams of owning a home.
Since the first similar long-term mortgage loan was granted in 2004, with this
latest loan the EBRD has lent three Serbian banks a total of €40 million to
promote this sector, thus supporting the development of a competitive market.
The latest loan builds on good cooperation between the EBRD and HVB Bank
Serbia & Montenegro. As well as supporting the mortgage sector, both banks
have worked together to help, for example, small and medium-sized enterprises
gain access to more finance to develop their businesses with loans and support
for international trade transactions.
Established in 2001, HVB Bank Serbia & Montenegro has over 43 branches and
units in key towns and cities across Serbia. The mortgage market is a
strategic development for the bank as one of the leaders of the market said
Alexander Picker, Chief Executive Officer of HVB Bank Serbia and Montenegro.
Our bank will continue to focus on the Serbian primary mortgage market for the
time being, but, at the same time, will take the necessary steps to enter the
secondary mortgage market in due time, for example, through the securitisation
of a portfolio of standardised mortgage loans. The co-operation with the EBRD
in this respect is very important, he added.
The EBRD is one of the largest investor in Serbia having committed almost €900
million at the end of April 2006 in 61 projects.
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