Published in «Russian Journal of Housing Research»3 / 2018
DOI: 10.18334/zhs.5.3.39509

Features of Russian mortgage-backed bonds market

Denisov Maksim Aleksandrovich, Altai State University, Russia

Особенности российского рынка облигаций с ипотечным покрытием - View in Russian

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Highlights:
Mortgage-backed bond is considered an important instrument of funding mortgage lending in a state strategy of housing development in Russia.
Mortgage-backed bond is an insignificant source of funding for mortgage lending in Russia but it has prospects to become the second largest source of funding.
One of the main features of the Russian mortgage-backed securities market is a significant market share of the mortgage-backed bonds issued with a guarantee from a state housing development institution.
The concentration of mortgage assets in a small number of lenders and risk of low demand for this financial instrument among investors are the factors that limit the growth of the market.
To develop the market it is important to stimulate lenders that hold a large share of mortgage assets to participate in process of mortgage securitization and to create conditions to attract investments.

Abstract:
This article examines the development of the mortgage-backed bonds market in the Russian Federation. The object of the study is the Russian mortgage-backed bonds market, the subject is defined as features of its development. Mortgage-backed bond as an instrument of mortgage securitization is an important source of financing mortgage loans. The goal of this article is to identify the features of the Russian mortgage-backed market. In this article, we discuss the structure of new mortgage-backed securities issuance to determine the effectiveness of mortgage-backed securities in attracting funding. The analysis based on literature and statistical data. In this work, we analyzed statistical data on the Russian mortgage market and the mortgage-backed bonds market to define structure of mortgage-backed securities (MBS) issuance and determine market dynamics. The initial data for the statistical analysis were the materials of the Central Bank of Russia, the Russian housing development institution (DOM.RF) and the European mortgage federation. The main features of Russian mortgage-backed market were identified as a result. A state owned housing development institution plays a key role in developing the Russian MBS market. In 2017, MBS issuance share with guarantee from the institution reached 87% of total volume of mortgage-backed bonds in Russia. However, the MBS market is a modest source of funding of mortgage loans in Russia. A small number of Russian credit organizations can use mortgage-backed bond as an instrument of financing. To support development of the Russian MBS market, it is necessary to stimulate theА largest mortgage lenders to participate in the programme of mortgage securitization and to create an environment to attract investment in the MBS market. In the future, the mortgage-backed bonds may represent the second most important source of financing mortgage lending in Russia.

Keywords:

DOM.RF, mortgage debt, mortgage-backed bonds, mortgage-backed securities (MBS), Mortgage-backed securities Factory, securitization

JEL-Classification: G10, O16, O30

Citation:
Denisov M.A. (2018). Features of Russian mortgage-backed bonds market [Osobennosti rossiyskogo rynka obligatsiy s ipotechnym pokrytiem]. Russian Journal of Housing Research, 5(3). (in Russian). – doi: 10.18334/zhs.5.3.39509.


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