We can speak about corporative mortgage in several aspects.
The first aspect is giving accommodation for the period of work in the company. Such a thing is used in practice when moving to another city to work there by contract. The classic example is giving accommodation, for instance, to footballers of FC ‘Dynamo’ (Kyiv), or to foreign top-managers with a contract for 1-3 years. The way the company solves this problem – either has several ‘own’ apartments, or takes them for rent – is just a technical question.
The second aspect is helping top-managers or company’s employees in purchasing accommodation. It is also just a technical question, in what way it will be realized – by decreasing the interest rate, or its partial compensation, or on the basis of the interest-free credit. Judging from general idea of mortgage crediting, such understanding the corporative mortgage is the only right here.
As it can be seen in practice, corporative mortgage is the lot of top-management and key specialists. At that the facts of preferential crediting in Ukrainian practice are isolated.
The advantages of corporative mortgage for such an employee are obvious. With the exception of one ‘but’, the employee becomes tied to the employer for a long time, and even stronger than it was supposed at the beginning.
The advantages of corporative mortgage are obvious for an employer, too. According to the opinion of Tatyana Shulga, the head of B2B department, the partner of ‘Brain Source International’ recruiting company, giving credits for personnel is one of motivational elements of the company, allowing retaining staff: employees who received a preferential mortgage credit leave the company more rarely.
Preferential mortgage credit is ‘hidden’ bonus to the salary. ‘For example, having received a discount of 7% of average market rate at the credit amount of $150,000 (the cost of two-room apartment), an employee saves around $800-900 per month during the first years of paying the credit. If an employee earns $2,000 per month, it’s equal to earning $2,900 and paying the credit on average market terms,’ underlines T. Shulga.
‘Employees who have to pay large credit sums take the risk of changing jobs more rarely. As coming to the different company is connected with the risk of failure during trial period, of being unaccepted to the new team, and, consequently, of remaining without job and assets necessary for paying the credit,’ adds T. Shulga.
‘Kind’ banks
Tatyana Shulga also noted that today not every company can afford such a luxury as giving preferential credits for its employees. ‘Most often such a method of motivating personnel is used at the banks. A large amount of assets of the bank institutions allows allocating some part of actives for preferential credits for the employees. The interest rate of such a loan ranges within 4-10% annually depending on period of work of the employee at the bank, level of occupation, and the bank itself,’ states the expert.
The chief executive of ‘Prostobank Consulting’ company Olga Onufriychuk adds in her turn that previously the Ukrainian banks used preferential credits as motivating element not very frequently.
‘However, as the competition caused by coming of the foreign banks that could offer our bank specialists more attractive terms of remuneration of labor is growing, there has begun significant fluctuation of personnel among specialists. Not all Ukrainian banks could afford significant raise in salary fund, that’s why they are more and more often using additional methods of motivation, such as interest-free or preferential accommodation credits. As a rule, such credits are given on general terms (i.e. on the same terms as to the bank’s customers with the exception of amount of interest rate which can be either zero, or lower that market one by 2-5 percentage points),’ states Olga.
The questioned representatives of several large banks denied the presence of preferential credit programs in their financial institutions. At that the official denial doesn’t mean the absence of preferential credits for top-management. It is just uncommon to speak about it. On the other hand, preferential credit terms concerning all employees exist at almost all banks, but in many aspects these ‘preferences’ are restricted by consumer loans of not more than $1-10 thousands.
