UPDATE: CEO says VTB mortgage rates at below 10%, to keep falling Jul–Dec

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MOSCOW, Mar 5 (PRIME) -- Russia’s second largest bank VTB Bank’s mortgages are already below 10% and will continue to fall in July–December, CEO Andrei Kostin told President Vladimir Putin on Tuesday.

“Today we still maintain our image, (the rates) have not reached 10%, and we believe that in the second half of the year the economic situation will create the possibility for lower rates… and the mortgage rates will decrease as well,” he said.

In February, Putin ordered the government and the central bank to develop additional steps to reduce mortgage rates of the Russian banks to below 8%.

Kostin also said that his bank intends to more than double the portfolio of realty developers’ loans from the current 300 billion rubles in the next three years and to open around 25,000 escrow accounts in line with the upcoming amendments to the housing construction rules.

From July 1, all Russian realty developers will have to use escrow banking accounts for shared construction. The construction will be paid with banking loans, while individual investors’ money should be available to the companies only after the apartments are transferred to the buyers.

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