Feb. 10 (Bloomberg) -- Kazakh property prices will probably stagnate as weak purchasing power depresses demand for housing, the central bank said in a quarterly survey of banks.
Stricter lending conditions, including high mortgage rates, are hindering home loans, the Almaty-based National Bank of Kazakhstan said in the report published on its website today. Fifty percent of the lenders that responded said mortgage demand will remain unchanged in the first quarter, while 37 percent expect an insignificant increase, according to the survey.
Kazakhstan’s 38 banks posted a combined profit of 38.9 billion tenge ($262 million) last year, according to the central bank’s financial oversight committee. The banks set aside 3.3 trillion tenge against bad loans, led by Kazkommertsbank and state-owned BTA Bank, which is seeking to restructure debt for the second time in as many years.
Thirty-seven of the nation’s banks responded to the survey, with 65 percent saying they expect the quality of their loan holdings to remain unchanged in the first quarter and 27 percent forecasting an insignificant improvement.
About 76 percent of respondents said the pace of corporate foreclosures will stay the same, with 18 percent predicting an insignificant increase. Eighty-eight percent said the pace of foreclosures on loans to individuals will stay the same, and 9.4 percent expect an insignificant increase.
The lenders surveyed by the central bank were asked to choose among five possible answers: significant increase, insignificant increase, no change, insignificant decrease and significant decrease.
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