DUBAI// The central bank of the UAE said on today its board had discussed plans to launch facilities for supporting property lending in the country. "The board discussed a memorandum on proposals for introducing financial vehicles for dealing with real estate loans, to ensure their continuity, in consultation with the Ministry of Finance", the central bank said in a statement, but did not give further details.
Thus far the country has largely escaped the worst of the fallout from the global economic slump triggered by a collapse of property prices in many developed countries. However, local banks have begun to tighten up lending criteria in response to a worldwide shortage of cash, which in turn has made it difficult for property buyers to access finance in recent weeks. Already some developers and brokers have reported flagging property sales and declining prices. Property is a mainstay of the economy and has played a significant part in lessening the country's dependence on crude oil. A slowdown in this sector is therefore a concern, according to analysts.
The central bank and finance ministry have already made available Dh120 billion (US$32.67bn) worth of emergency funding facilities since September to help banks cope with the fallout of a global financial crisis. The board also approved applications by banks to expand their businesses and open new branches, the central bank added. business@thenational.ae With Reuters
