NPLs a concern to Housing Finance Corporation

The fundamentals of the Housing Finance Corporation (HFC) are sound, although non-performing loans remain a concern, the organisation said on Tuesday.

According to HFC chairman Loizos Papacharalambous, the organisation’s liquidity ratio currently stands at over 30 per cent, while its loan-to-deposit ratio has dropped to 82.3 per cent, compared to 87.4 in December last year and 93 per cent in December 2013.

The HFC was established by the state in the early 1980s to facilitate access to mortgages, particularly to vulnerable groups. It grants loans to families to obtain their first home and to low-income groups on favourable terms.

Deposits held with the HFC now stand at €910m.

Non-performing loans (NPLs) currently account for 36 to 38 per cent of its loan portfolio, which comes to €752m.

The organisation has recently hired staff to deal exclusively with NPLs, Papacharalambous said.

The HFC holds assets worth €1.1bn, although total assets – counting also the loans managed on behalf of the state and the Central Agency for Equal Distribution of Burdens – come to €1.6bn.

Over the years, the organisation has offered home loans to some 33,000 households, of a total value of €2.2bn.

Speaking ahead of the inauguration of the HFC’s new headquarters this week, Papacharalambous announced that the organisation will be expanding its loan products.

In addition to loans for obtaining a primary residence, the HFC would be offering credit for energy efficiency improvements to homes and for maintenance and renovation works.

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