Angola: New Home Loan Regime

By way of Order 9/23, of 3 August 2023, the Angolan Central Bank (BNA) has enacted a new Home Loan Regime. The new regime is mandatory to all “systemically important financial institutions” operating in Angola. The regime is optional for the other financial institutions.  

Below is an outline of the new Home Loan Regime:

• Commercial banks are required to adopt robust credit risk policies in providing home loans, which must include:
• Undertaking a rigorous evaluation of client’s credit worthiness before granting any loan;
• Assessing the risks related to the property, the seller, and the builder as applicable;
• Monitor the implementation of the house construction project, if applicable;
• During the term of the loan, identify any situations which may increase the risk of default and take appropriate measures to mitigate such risk.
• Annual interest rates for home loans cannot exceeded the following:

For home loans:

• 7% (seven per cent) until 31 May 2032;
• From 1 June 2032, the 30-day interbank interest rate with a maximum 1% spread.

For building/construction loans:

• 10% (ten per cent) until 31 May 2027;
• From 1 June 2027, the 30-day interbank interest rate with a maximum 1% spread.

Commissions and other costs charged by the banks are subject to the following limits:

• Initial commission for granting a loan – maximum 1% of the loan value;
• Commission for extending or restructuring the loan – maximum 0.5%;
• No commissions can be charged in case of early repayment of the loan;
• The following commissions/costs can be charged separately (in addition to the 1%/0.5% limit): property evaluation, fees of building inspector, notary and registration fees, insurance, and taxes applicable on the loan.

• Home loans cannot exceed Kz 100.000.000,00 (roughly USD 120,000) per client. Only one loan can be granted per property;
• The maximum loan term is 30 (thirty) years;
• The loan cannot exceed 100% (one hundred per cent) of the purchase price or the property value, whichever is lower;
• The banks may require guarantors for the loan as they see fit;
• Information on home loan eligibility, and terms and conditions must be clearly displayed by the banks in their websites;
• The banks must submit to BNA a list of home loans granted/restructured on a monthly basis.

The granting of home loans is further subject to existing applicable legislation, including BNA Orders 14/16, of 7 September 2016, 4/19, of 26 April 2019 and 7/20, of 20 April 2020.

Rui Amendoeira – OneLegal Partner