Articles

The share of the Agency for Mortgage and Housing Credit on the refinancing market reduced from 71.8% to 55.3% in 2006. Almost a half of mortgage bonds sold by banks was purchased by market participants, including specialized refinancing agents, large bank, funds, management companies, and foreign investors. According to the Bank of Russia, mortgage claims are in the greatest demand with banks (their market share increased from 14.3% to 21.2%) and with foreign companies (from 2% to 14.5%).

State-owned banks VTB 24 and Gazprombank's subsidiary GPB-Ipoteka account for over a fourth of refinanced credits. Besides making money on the resale of mortgage bonds, state-owned banks have an additional incentive to buy these credits - now they can place temporarily free funds. "In 2007, we don't plan to refinance mortgage credits, both our credits and credits redeemed from other banks. The reason is market conditions. Besides, after the IPO, it is to our advantage to invest in mortgage credit claims and hold them on our books," said Anatoly Pechatnikov, Director of Mortgage Lending at VTB 24. The amount of mortgage credits purchased by VTB 24 equated to 4 billion rubles at the beginning of 2007 and increased by another 0.8 billion rubles within six months.

DeltaCredit Bank (1.4 billion rubles in 2006) and KIT Finance (3.5 billion rubles) are among the largest operators on the secondary market. "The share of credit institutions of the secondary mortgage lending market is increasing, because they offer more favourable terms of refinancing and pay rather high commissions to partners," Vadim Pakhalenko, Director of Department for Relations with Financial Institutions at DeltaCredit Bank, explains.

Foreign investors are also interested in the Russian market of mortgage refinancing. Last year, they acquired mortgage bonds worth 7.6 billion rubles. It is 30 times more than in 2005. This is just the beginning. It is known to RBC daily that a Dutch investment bank ABN Amro plans to make agreements with Russian lenders through its conduit Orchids on acquisition of claims to the amount of $1.5 billion at most during a year, of which a greater part will be mortgage credit claims.

The structure of the market may change drastically in the nearest future. Specialized institutions intend to give billions of dollars for mortgage borrowers. Alexander Chernyak, General Director of a refinancing company ATTA Ipoteka, told RBC daily that the company's present portfolio of mortgage credit claims amounted to over $300 mln and the three-year development program of the company provided for its rise to $1.5 bln. Vladimir Ponomarev, General Director of the Russian Mortgage Acceptance Company (RuMac), stated that his company had already signed refinancing agreements with several tens of regional banks within the framework of a mortgage conduit. By the middle of 2007, RuMac entered into refinancing agreements with banks to the amount of $2 bln.