He told the House finance committee that 28% of HFC’s €776 million loan portfolio was non performing but added that all its loans were covered by collateral as it only offered housing loans.

The HFC was created by the state in the 1980s to provide long-term loans to first-time buyers or to low and middle income families that owned no prior property.

Its core tier one capital was €90 million or 18%.

The chairman said the HFC planned to raise its provisions for bad debts from 12% to 20% by the end of 2015, on the instruction of the Auditor General and the Central Bank.

The organisation also announced it was cutting its interest rate to 3.75% from the current rate of 4.25% starting April 1.

The HFC website was expected to be updated on Monday to include all new loans that will be offered and the new interest rates that will come with more conditions.

Source: Cyprus Mail