IBRD to provide Russia with loan in order to develop mortgage lending

The management of the IBRD (International Bank of Reconstruction and Development) have said they are willing to provide Russia with a loan in order to develop mortgage lending for less well off citizens and in order to modernise housing and communal services. As a Rosbalt correspondent reports, this was announced by Chairman of the Russian State Construction Agency Nikolai Koshman yesterday. A provisional agreement on the loan was reached during a visit by a Russian delegation to the US in May of this year, Mr Koshman pointed out.

He said a loan of USD 200 million would go 'towards developing the engineering infrastructure in the different regions, the construction of housing and a programme to promote mortgage lending.' This money will also be spent on 'providing the necessary legal reform and organising an effective system of mortgage provision.' In particular, Mr Koshman said, the money will be spent on construction equipment that will be specifically used to build houses under mortgages for the less well off.

The Russian government will take responsibility for paying back the first 15-year loan of USD 200 million. This money is expected to go towards the construction of 3 million square metres of housing. The remainder of the loan will be received at regular intervals providing that the Russian government and the regional participants in the project meet all their obligations.