The Housing Fund of Finland

The Housing Fund of Finland is a fund operating under the Ministry of the Environment but outside the State budget. The Fund pays interest subsidies for loans and grants related to interest subsidy loans allocated by financial institutions for state-supported housing production and fundamental renovations. Furthermore, the Fund pays for municipal engineering grants allocated to promote housing production, grants intended for the development of housing estates and a range of support measures aimed at rental dwellings in financial difficulties.

In addition, the Fund is liable for conditional guarantees of interest subsidy loans, state guarantees of owner-occupied housing loans, primary loan securities related to old ARAVA loans, rented dwellings’ loans against a personal guarantee and expenses due to the securing of outstanding loans. Amortization and interest on the Fund’s debts are also paid from its assets.

The Housing Fund of Finland’s income is based on interest from old ARAVA loans, amortizations and guarantee payments related to a range of state guarantees. On 31 December 2009, the Fund’s balance sheet totalled EUR 9,134.7 million.

The Housing Fund of Finland operates outside the State budget and does not employ a staff of its own.

Any decisions made by the Board are prepared by the Housing Finance and Development Centre of Finland (ARA). Any decisions pertaining to the approval of interest subsidy loans and grants are made by ARA. Interest subsidy loans and the related grants are subject to regional and other allocations, in addition to the monitoring of project plans and costs. The Treasury handles payment traffic and the accounting of assets outside the State budget. However, grants made from the Fund’s assets are paid by the Housing Finance and Development Centre of Finland in cooperation with the State’s finance and HR service centre.

The Treasury handles debt collection related to outstanding ARAVA loans and is responsible for financial support measures related to the loans. However, the Housing Finance and Development Centre of Finland decides on grants and compositions related to demolitions. In addition, ARA issues a statement pertaining to the compositions issued in connection with the lifting of the ARAVA restrictions. The Fund is responsible for its own fund-raising and the Treasury is in charge of the implementation of the Board’s decisions related to fund-raising.

ARA and the Treasury are responsible for the risk management, monitoring and development related to ARAVA loans and guarantees.

2009 was the Fund’s 20^th year in operation.

Financial yields comprise the interest yields of ARAVA loans granted by the State. In 2009, the Fund raised EUR 353 million in interest yields.

The year’s financial costs totalled EUR 41.8 million.

Financing surplus amounted to EUR 317.7 million.

A EUR 228 million transfer from the Housing Fund of Finland to the State budget was approved in the 2010 State budget.