The Asian Development Bank (ADB) has approved a $150mn loan that would help expand green renovation loans in Uzbekistan while boosting the funding available to commercial lenders in the republic to continue providing affordable home loans.
Under ADB's Mortgage Market Sector Development Program, the loan would supplement funding for the Mortgage Refinancing Company of Uzbekistan (UzMRC) to make local currency resources available to eligible financial institutions that provide residential mortgages, home improvement loans, and refinance green renovation loans. In Uzbekistan, borrowers can use green renovation loans to refurbish or install heating and cooling systems, install solar panels, enhance insulation, and water-improving energy efficiency.
'A safe and comfortable home is a basic human right, and we are pleased to have helped increase the availability of affordable mortgages in Uzbekistan,' ADB Director General for Central and West Asia Yevgeniy Zhukov said.
'We are also delighted that this program will help homeowners improve their household energy efficiency and promote climate mitigation,' he added.
With ADB's support, UzMRC will develop and implement the green renovation loan tool kit, which includes an eligibility assessment of green renovation products and energy-saving calculations.
Under the ADB program, at least 32.5% of the loans should go to women. The loan will also promote financing mechanisms to catalyze market-based mortgage finance in Uzbekistan, expand the availability of residential mortgage products, including green financing, and bring product innovation to the banking sector.
'ADB's support will continue to broaden access to housing finance across Uzbekistan by providing critical long-term funding to participating financial institutions,' ADB Principal Financial Sector Specialist Syed Ali-Mumtaz H. Shah said.
'The inclusion of green financing and product innovation in the banking sector will also lengthen the tenor of market-based mortgage loans,' he concluded.
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