Government intends to increase capitalization of KMC by KZT20.5 bn. in year 2007 - head of Ministry of economy

/INTERFAX-KAZAKHSTAN, Astana, October 16, 07/ - Government of Kazakhstan indents to increase in year 2007 the capitalization of Kazakhstan mortgage company JSC (KMC) by KZT20.5 bn. (current 120.66/$1) for redeeming of mortgage credits form second tier banks. "By us is offered to increase the volume of redeeming of requirements rights from second tier banks on mortgage credits through Kazakhstan mortgage company. For that in year 2007 is offered to increase the volume of its funding from republic budget by amount of KZT20.5 bn.", - told the minister of economy and budget planning Bakhyt Sultanov on the session of government on Tuesday in Astana. Except this, by his words, the given institution may also conduct borrowings on the market of loan capital, and these resources would be directed on stabilization of mortgage market, first of all for security of rights of stakeholders of building habitation. "In case of need sum of capitalization of the company would be increased in year 2008", - B.Sultanov stressed. Meanwhile, as the minister noted, in the frames of state support of financial sector the government intends to increase financing of development institutions, which "will be able to provide continue of financing through banking system of small and middle business' organizations on terms acceptable for them". "Because this segment of market needs significant funds, which per se are not disappearing but have the returning character, is it suggested to extract from republican budget KZT122 bn. for these aims", - the minister stressed. At that, as he had noted, state fund Kazyna have to provide "in order credit rates for final receivers - organizations of small and middle business - would be adequate to situation and enough effective". "Borrowers, which are realizing the perspective large projects, also would be crediting on terms, not worse than by second tier banks", - B.Sultanov explained in this connection. By his words, as the result of realization of these mechanisms of financing it is expected the "decision of questions of stakeholders and provision of stability of mortgage market by its smooth correction, and also unbreakable realization of projects of small and middle business and perspective investment projects". KMC is working on financial market of republic since December 2000 in the frames of realization of state habitation program. Main directions of activities of KMC are purchasing of requirement rights on long term mortgage habitation loans, given by banks, and also borrowing of long term resources for mortgage crediting, including by issuing of own mortgage securities. Shareholder of company is government in face of Ministry of finance. [2007-10-16]