Government Opposes Urgent Housing Subsidy Request

TDT | Manama                                                      

The Daily Tribune – www.newsofbahrain.com

Email: mail@newsobahrain.com

The government has opposed an urgent request from the House of Representatives to provide financial support to beneficiaries of housing services affected by increased interest rates on additional mortgage loans.

The government stated that the Central Bank of Bahrain (CBB) has reached an agreement with the relevant banks to cancel planned increases in interest rates on additional mortgage loans obtained by beneficiaries of housing finance programmes. 

"The interest rates will remain at the previously agreed-upon levels. The banks involved have publicly announced this decision and notified their customers accordingly," the government stated in its response. 

The government further emphasised its ongoing commitment, since the launch of housing finance programmes (including Mazaya and Tasheel programmes), to protect beneficiaries from negative impacts. 

"Through continuous coordination between the Ministry of Housing and Urban Planning, the Housing Bank, and the CBB, the government has ensured that interest rates charged by participating banks remain within pre-determined limits," the government pointed out in its response.

"This proactive approach aims to safeguard the financial well-being of those utilising government housing programmes," it added. The government's statement suggests that the measures already in place adequately address the concerns raised by the House of Representatives, rendering the proposed urgent financial support unnecessary.

It's worth noting that several banks had increased interest rates on mortgages, citing the introduction of new benchmark rates. This sparked concern among numerous beneficiaries of government housing programmes. 

However, the Central Bank of Bahrain successfully renegotiated these increases, averting further hardship. In light of the initial rate hikes, the Parliament subsequently proposed government financial support for affected homeowners.