State of Connecticut Comprehensive Annual Financial Report Fiscal Year Ended June 30, 1998 - Notes to the Financial Statements

Loans receivable for the primary government and its component units, as of June 30, 1998, consisted of the following (amounts in thousands):

Primary Government


	Special Revenue	Enterprise	Trust and Agency	Higher Education	Total	Component Units

Mortgage	$ -	$ -	$ -	$ -	$ -	$ 2,743,718
Industrial	-	-	-	-	-	177,310
Housing	204,387	91,364	-	-	295,751	-
Clean Water	60,886	-	437,586	-	498,472
Student	-	-	-	23,900	23,900	-
Other	139,983	-	56	7,506	147,545	73,135
Less:
Allowance for Losses	-	2,375	-	2,108	4,483	51,069
Loans Receivable Net	$ 405,256	$ 88,989	$ 437,642	$29,298	$961,185	$ 2,943,094

The mortgage loan program consists of home, multi-family and construction loan mortgages made by the Connecticut Housing Finance Authority. Most home loans are insured by the Federal Housing Administration or guaranteed by the Veterans Administration. In addition, some home and multi-family loans are insured or guaranteed by private insurers. Permanent loans earn interest at rates ranging from 0% to 13.5% and have initial terms of 10 to 40 years. Construction loans earn interest at rates ranging from 0% to 10.88%. Upon completion of each development, the related permanent mortgage loan, which will generally be provided by the Authority, will be payable over 30 to 40 years at annual interest rates ranging from 0% to 10.38%.

The Clean Water fund loans funds to qualified municipalities for planning, design, and construction of water quality projects. These loans are payable over a 20 year period at an annual interest rate of 2% and are secured by the full faith and credit or revenue pledges of the municipalities, or both.

The industrial loan program consists of loans made by the Connecticut Development Authority to finance the purchase of land, buildings, and equipment by qualified applicants and to finance other economic development programs of the Authority. These loans are collateralized by assets acquired from the proceeds of the related loans. These receivables have originating terms of 1 to 25 years and earn interest at rates ranging from 3% to 12%. As of June 30, l998, loans in the amount of $49.9 million (including loans of $8.9 million made by other lending institutions) were insured by an insurance fund created by the Authority and by the faith and credit pledged by the State. This insurance fund had net assets of $8.4 million at year end. Thus, the State is contingently liable in the event of any defaulted loans that could not be paid out of the assets of the insurance fund.