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. Last Updated: 07/27/2016

State Aids Mortgage Program

The government has pledged 2 billion rubles ($63 million) to support the agency for mortgage and housing credits' floundering national mortgage program.

Prime Minister Mikhail Kasyanov said Friday that the government plans to make the program operational within the next year, Prime-Tass reported.

The agency's head, Alexander Semenyaka, said at a news conference Friday that the 2 billion rubles would be paid out in tranches this year and next year.

Semenyaka was brought in four months ago to bring new impetus to the agency, which has achieved little in the five years since it was created.

He said the agency's scheme would eventually finance itself, but the government needed to supply seed money so a mortgage market could develop. "The state should support the market until it is able to finance itself," he said.

Kasyanov said the mortgages would help stimulate the economy. The system will "not only promote improvements in the construction of homes, but will also enliven the financial market," Prime-Tass quoted him as saying.

The agency plans to offer refinancing for mortgages in rubles at a rate of 18 percent per year for five to 20 years.