Providing housing for the most vulnerable population strata by providing them with compensation of interest rate for loans at the expense and with involvement of grant resources

1. State specialised financial institution
“State Fund for the Promotion of Youth Housing Construction”**
PROJECT IMPLEMENTATION CONCEPTION:
“Providing housing for the most vulnerable population strata by providing them with compensation of
interest rate for loans at the expense and with involvement of grant resources”
Chairman of the board: Serhii Komnatnyi
The city of Kyiv, 2a Maksym Kryvonos
interel@fhb.kiev.ua
www.molod-kredit.gov.ua
044 275 14 37
044 275 01 39
PARTNERS:
Mingerion
MinTOT
Minmolodsport
Local self-government bodies
Civic organizations
International Organizations
PROJECT IMPLEMENTATION PERIOD: 5 YEARS
PROJECT IMPLEMENTATION TERRITORY: ALL REGIONS OF
UKRAINE
COST OF THE PROJECT: 10 MIL EURO (316,59 MIL UAH)*
*According to Ukrdealing inter-bank exchange rate of EUR to UAH (buying rate) as of 06.12.2018
** © Translation into English was supported by the Council of Europe Project
«Internal Displacement in Ukraine: Building Solutions», 2019

2. GRANT RECEIVER
State specialised financial institution "Derzhmolodzhytlo"
 Statutory capital - 10,4 mil EUR (331 mil UAH)
 Financial services licences
 Credit portfolio - 39,4 mil EUR (1 249 mil UAH)
 Families provided with housing - 115 007
 26 years of experience in housing projects implementation
FOR LEGAL ENTITIES
• Initiatives to improve legal framework in housing sphere
• Participation in preparation of drafts on making amendments to
regulatory legal acts currently in force
• Participation in drafting new regulatory legal acts
• Housing crediting at subsidized interest rates (youth, pedagogues, scientists, ATO
participants, internally displaced persons, doctors, public-sector employees etc)
• Compensation of a part of a housing cost
• Compensation of a part of a mortgage interest
• Crediting of legal entities, including Associations of co-owners of apartment
buildings to hold emergency efficiency and heat preservation activities
• Creation and maintenance of the Housing Building Financing Fund
EXPERIENCE
Regional offices in all
regions of Ukraine
17 regulatory legal acts were developed
during last two years with participation of Derzhmolodzhytlo:
6 - draft Laws of Ukraine, 12- resolutions of the Government
Adopted: 1 Law of Ukraine, 4 Resolutions of the Government,
12 regulatory legal acts - in progress

3. PROBLEM
OBJECTIVE
 6 850 candidates to receive subsidized loans which are registered in a unified information analytical record
keeping system of youth crediting of Derzhmolodzhytlo
 Over 9 400 citizens registered in the open electronic register of Derzhmolodzhytlo - candidates to receive
state support to build (purchase) affordable housing, of them: 6 673 IDPs
 High level of mortgage interest rates
To solve housing problem for the most vulnerable population strata (youth, IDPs) by
providing them with compensation of interest rate for loans provided at the expense of
resources of Derzhmolodzhytlo and commercial banks

4. CREDITING AT OWN EXPENSE (FUNDS OF STATUTORY CAPITAL) OF DERZHMOLOZHYTLO (INTEREST RATE
IN THE AMOUNT OF THE NBU DISCOUNT RATE WHICH IS CURRENTLY 18%)
BANK CREDITING FOR HOUSING CONSTRUCTION OR PURCHASE (AVERAGE CREDIT RATE IS 22%)
HIGH LEVEL OF MORTGAGE INTEREST RATES
EXISTING PROJECTS. What exactly is necessary? Why our project?
MECHANISM OF COMPENSATION OF INTEREST RATE UNDER LOANS OF DERZHMOLODZHYTLO AND
COMMERCIAL BANKS IS A STIMULATING MECHANISM IN ADDRESSING HOUSING ISSUE OF YOUTH
AND INTERNALLY DISPLACED PERSONS
 Providing housing for the most vulnerable social groups
 Integration of internally displaced persons to the community
 Decreasing the level of emigration from Ukraine (retention of human and labor potential inside the country)
 Stimulation of construction industry
 Positive demographic effect (around 57% of program participants have 2 and more children)
 Stimulation of economic activity of population

5. IMPLEMENTATION MECHANISM
GRANT RESOURCE
RECEIVERS
(borrowers)CONDITIONS:
1. Compensation - 50% of interest rate;
2. Compensation period - during 5 years;
3. Interest rate under loans:
Derzhmolodzhytlo - the NBU discount rate*
Commercial banks ≈ 22%
Channelling 10 mil EUR (316,59 mil UAH)** to provision of interest rate compensation under loans will allow to
provide housing to 1018 families during 5 years
* Discount rate of the National Bank of Ukraine as of 06.12.2018 - 18%
**According to Ukrdealing inter-bank exchange rate of EUR to UAH (buying rate) as of 06.12.2018
loan repayment
construction
investment
repaymentloan
compensation of
interest rate
agreement
annually, upon
necessity

6. DEADLINES, IMPLEMENTATION STAGES
ACTIVITY EXECUTORS, PARTNERS IMPLEMENTATIO
N DATE
RESULT
Determination of partner banks Derzhmolodzhytlo
Grantor
Before providing a
grant resource
Cooperation with banks
Citizens notification on possibility of
receiving interest rate compensation under
loans and necessity to submit respective
documents
Derzhmolodzhytlo
Citizens
After a grant resource
is received
Submission of necessary
documents by citizens to
Derzhmolodzhytlo
Conclusion of agreements for
compensation of interest rate under loans
Citizens
Derzhmolodzhytlo
Commercial banks
As far as the
documents are
submitted by citizens
Conclusion of agreements
Servicing of agreements for compensation
of interest rate under loans
Derzhmolodzhytlo
Citizens
During 5 years Compensation of interest rate
under loans
Reporting to the donor on the use of grant
funds and other information
Derzhmolodzhytlo
Grantor
Permanently Exchange of information of
establishing further cooperation

7. BASIC CALCULATIONS
Attracted grant EUR 10 mil (316,59 MIL UAH)*
AVERAGE LOAN INDICATORS (PER 1 AGREEMENT) ESTIMATED VALUE (PER 1 AGREEMENT)
AVERAGE VALUE OF INVESTMENT OBJECT EUR 24 891
(788 014 UAH)*
AVERAGE BORROWER'S LOAN AMOUNT EUR 22 402
(709 213 UAH)*
AVERAGE AMOUNT OF BORROWER'S MONTHLY PAYMENT
(PRIMARY LOAN + INTEREST RATE) DURING 5 YEARS
EUR 420
(13 322 UAH)*
AVERAGE AMOUNT OF INTEREST RATE COMPENSATION UNDER THE LOAN DURING 5
YEARS
EUR 164
(5 184 UAH)*
AVERAGE AMOUNT OF BORROWER'S MONTHLY PAYMENT
(PRIMARY LOAN + INTEREST RATE) INCLUDING INTEREST RATE COMPENSATION
DURING 5 YEARS
EUR 258
(8 139 UAH)*
AVERAGE AMOUNT OF INTEREST RATE COMPENSATION RECEIVED BY THE
BORROWER
FOR 5 YEARS
EUR 9 824
(311 019 UAH)*
AVERAGE AMOUNT OF BORROWER'S MONTHLY PAYMENT (PRIMARY LOAN +
INTEREST RATE) AFTER TERMINATION OF INTEREST RATE COMPENSATION UNDER
THE LOAN
EUR 234
(7 412 UAH)*
*According to Ukrdealing inter-bank exchange rate of EUR to UAH (buying rate) as of 06.12.2018

8. 1018 FAMILIES WILL RECEIVE INTEREST RATE COMPENSATION UNDER LOANS DURING THE
FIRST YEAR OF IMPLEMENTATION
 DECREASE OF SOCIAL TENSION
 INTEGRATION OF INTERNALLY DISPLACED PERSONS TO THE COMMUNITY
 DECREASE OF OUTFLOW OF HUMAN AND LABOR POTENTIAL INSIDE FROM THE COUNTRY
 AROUND 57,6 THOUSAND M2 OF BUILT (PURCHASED) HOUSING
 OVER 22.8 MIL EUR (721.9 MIL UAH) OF ATTRACTED CREDIT RESOURCES OF FINANCIAL
INSTITUTIONS OF UKRAINE
 OVER 25,3 MIL EUR (OVER 800 MIL UAH) OF ATTRACTED INVESTMENTS FOR HOUSING
CONSTRUCTION (including own contributions of investors)
 IMPROVEMENT OF DEMOGRAPHIC SITUATION
 STIMULATION OF ECONOMIC ACTIVITY OF POPULATION
RESULTS