Business | Banking
Qatar eyes home loan changes
Qatar's central bank is considering tighter home finance rules, including reducing how much banks can lend in mortgages, as the dollar-pegged state slashes interest rates and battles spiralling inflation.
- Reuters
- Published: 00:36 May 7, 2008
Dubai: Qatar's central bank is considering tighter home finance rules, including reducing how much banks can lend in mortgages, as the dollar-pegged state slashes interest rates and battles spiralling inflation.
Central banks across the world's biggest oil-exporting region are trying to rein in lending as they tracked seven interest rate cuts by the US Federal Reserve since September, further stoking inflation to record and near-record peaks.
The Qatar central bank is proposing increasing a home buyer's minimum mortgage down payment to 30 per cent from 10 per cent, and cutting the maximum loan term to 20 years from 30 years, according to a note to banks, obtained by Reuters.
"This region needs monetary policy tightening because inflation to a huge extent is the result of huge liquidity," said Marios Maratheftis, regional head of research at Standard Chartered Bank.
"Since the dollar peg restricts monetary policy tightening, they have to look at alternatives," he said.
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