Govt starts gathering realty market data:Soft Home Loans for Civil Servants.The government has intensified its effort to figure out the feasibility of providing apartments and housing units to civil servants on soft loan. While announcing relief measures to prop up realty market, the High- Level Financial Sector Coordination Committee had decided last month to work on arranging cheap home loans for civil servants. The Housing Management Advisory Committee (HMAC), headed by Nepal Rastra Bank (NRB) Deputy Governor Maha Prasad Adhikari, and technical sub-committee within that committee led by Joint-Secretary at the Finance Ministry Baikuntha Aryal are collecting data at war footing. On Sunday, the HMAC sent letters to Nepal Bankers’ Association, Development Bankers’ Association of Nepal and Nepal Finance Companies Association through NRB seeking details about their lending in realty sector. In its letters, the committee has asked those associations to furnish details about the lent amount, number and types of realty lending as well as average interest charged under different category and classification of loansgood, sub-standard, doubtful and bad. Similarly, the technical subcommittee has sought details from the Nepal Land and Housing Development Association on the residential housing throughout the country.

The government has directed the committee to carry out a research and submit its suggestion by mid-April. According to Aryal, the technical sub-committee will try to submit its report to HMAC by the end of March. “The meeting of the technical sub-committee has not been held yet. But we have already started seeking the statistics,” said Aryal. Based on the statistics, the main committee will forward the report to the government suggesting about the feasibility of providing home to civil servant at subsidised rates. Majority of bankers, however are unaware of the purpose of such data mining, as a CEO of one commercial bank remarked: “In my opinion, it is the effort of the regulator to understand the gravity of the problem created due to financial sector lending into realty sector.”

source: The Kathmandu Post,7 March 2012