Construction workers in Beirut, Sunday, April 2, 2017. (The Daily Star/Mohammad Azakir)
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The crisis was further exacerbated after the Central Bank announced that most banks had exhausted the cash injected by BDL to subsidize housing loans for limited-income families.Central Bank Gov. Riad Salameh said Monday that nearly $500 million in funds provided by Banque du Liban to banks for housing loan purposes had run out in just one month due to unprecedented demand.Salameh said BDL had provided banks with the funds, to be used by members of the public to purchase apartments, in February. These banks are now offering housing loans in dollars instead of Lebanese pounds with an interest rate of around 6-7 percent, compared to 3 percent for subsidized loans.The Central Bank usually funds the housing loans through the Public Housing Corporation, which is under the umbrella of the Social Affairs Ministry; and the Housing Bank, which is controlled by the leading commercial banks and the state.The Central Bank also changed the mechanism for obtaining a subsidized loan. Now the beneficiary has to pay an interest rate of 3.75 percent instead of 3 percent, while the period for paying installments has ben reduced to 20 years from 30 years.
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