Kazakh banks to stop extend loans if monthly payments exceed borrower’s income 50%

March 6, 2014

ALMATY. Interfax-Kazakhstan

The National Bank of Kazakhstan introduces restrictions on extending banks loans and credit lines starting from April 1.

According to the regulation of the National Bank published on Thursday, the bank should use the borrower’s debt ratio in the loan decision-making. “The average monthly loan payment should not exceed 50% of the borrower’s income,” according to the regulation.

The Bank must deny the borrower the loan, if the borrower’s debt ratio exceeds the specified value (0.5). The bank will also not give consent to open a credit line (credit limit), extend an additional loan under the bank loan agreement or change loan terms.

This rule does not apply to the loan or part of the loan within the line of credit opened earlier.