120 billion MNT allocated for Ipotek loans in 2018

B.Chimeg GoGo.mn

2017-11-08 17:13 GMT+8

Under the proposed 2018 state budget, 120 billion MNT will be allocated for Ipotek loans.

The allocation for the 2017 state budget was 111 billion MNT. Since the implementation of the International Monetary Fund’s Extended Fund Facility program, the Bank of Mongolia (BoM) has been financing Ipotek loans with bond financing.

The government has been responsible for financing in the form of coupon payments and 9 billion MNT distributed to commercial banks from the state budget each month.  The BoM is financing 16 billion MNT in Ipotek-backed bonds and 25 to 35 billion MNT in loan financing is being allocated to commercial banks.

The government is expected to be in full control of the Ipotek loan program in 2018, as discussed with the IMF. The balance of Ipotek loans currently stands at 4.2 trillion MNT, with 77 percent of loans having a 5 and 8 percent interest rate and the remaining 23 percent of loans having bank financing.

In September 2017, 49.6 billion MNT in loan financing was granted to 808 borrowers, which brings the total number of Ipotek borrowers to 92,600. Ipotek loan approvals fell by two percent compared to September 2016.

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