BCR First Home Quota Increased

Banca Comerciala Romana (the Romanian Commercial Bank - BCR) will be able to issue more loans under the State-driven First Home Programme, as the National SME Loan Guarantee Fund (FNGCIMM) has increased the bank"s quota into the programme by some 108 million EUR, according to a press release. BCR therefore has global State guarantee of 420 million EUR for the mortgage loans issued under the housing scheme designed to help Romanians buy their first home and concurrently stimulate the ailing construction industry.

The FNGCIMM has decided to re-allocate a portion of the quotas previously offered to banks, which have not seen much success in disbursing loans under the governmental programme. FNGCIMM President Aurel Saramet announced that the Government was going to withdraw 220-280 million EUR from seven or eight banks participating in the First Home Programme, which had used very little of their quota, and reallocate the money to the best performing lenders. He explained that seven or eight banks had drawn between zero per cent and 0.3 per cent of their quota and would therefore forfeit (most of) the rest.

Banca Comerciala Romana has so far received nearly 4,800 applications for loans under the First Home Programme totalling over 205 million EUR, according to a report released by the bank. Nearly 3,000 of these applications, totalling over 137 million EUR, have already been approved and have been or are about to be endorsed by the FNGCIMM. The remaining applications are in various phases of review or require specific documentation regarding the property to be mortgaged.

The bank offers First Home loans with an interest rate calculated as EURIBOR 3M plus 3.8 per cent margin, for a maximum period of 30 years. The disbursement fee, applicable only once, is 0.5 per cent. Loans offered under this scheme cannot exceed 57,000 EUR. The mandatory down payment is 5 per cent of the value of the property, if such value is smaller than or equal to 60,000 EUR. If the value exceeds 60,000 EUR, the down payment is equal to the delta between the price of the property and the maximum loan value of 57,000 EUR.

BCR is the largest bank in Romania, with assets in excess of 17.2 billion EUR.