Subsidy scheme boosts OTP mortgages

jessica fejos

Clients of OTP Bank applied for more than HUF 105 bln of mortgage loans in the first half, 90% more than in the corresponding period of 2015, the lender said in an earnings report released today, as reported by Hungarian news agency MTI.

Just under half of the applications were combined with the governmentʼs recently expanded home purchase subsidy scheme for families.

In the second quarter, mortgage loan demand generated by the subsidy scheme rose 56% quarter-on-quarter, which is expected to show up in higher outlays in the second half of the year, OTP said.

In the first half, OTP received about 4,900 applications for HUF 13.1 bln of the subsidies. About 15% of applications for new homes were made by families with three or more children, although these applicants accounted for about half of the total subsidy volume, OTP noted.

In spite of the increased demand for mortgages, OTPʼs mortgage portfolio still declined by 3% in the year to date because of the effect of normal amortization and pre-payments.

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