The government offered to insure the risks of banks on mortgage loans

The government offered to insure the risks of banks on mortgage loans


Insurance from the seller

Deputy Prime Minister Igor Shuvalov on Tuesday, 17 may, said that soon will be a new financial instrument — risk-free mortgage securities. “We are now in the preliminary plan agreed with the Central Bank — the Central Bank went to meet, we will try as a pilot project to produce a paper that will be based in many ways risk-free a mortgage”, — quotes “Interfax” the statement Shuvalov at a meeting of the state Council on housing.

Finance Minister Anton Siluanov added that the most important thing is to ensure reliability of this valuable paper, that it was secured by a real square meters.

Mortgage securities — a debt paper of the Bank, which secured a mortgage loan. Other banks or funds buy them and receive interest payments from the funds received for payment of the credits. The issuance of mortgage-backed securities or securitization allows banks to unload the balance and the funds that banks receive after the sale of securities, they provide new loans.

The idea of mortgage securities issue was raised following discussions with the Ministry of Finance, Central Bank and HMLA further measures to support the mortgage market after the completion of the state program of subsidizing of rates (valid until the end of 2016).

As explained by Deputy Finance Minister Alexei Moiseyev, the seller has a project that aims to help small banks to securitize mortgages with the help of capital of the seller. “The paper will be conditionally risk-free. It would fit the concept of “Basel”, which says that if the Bank has the support of the state, in this case on the part of the seller, the controller can evaluate the asset as less risky,” said Moses. In particular, banks will need to create fewer reserves on such assets.

Essentially, this means that the Agency will provide buyers of mortgage-backed securities insurance — in the event of default on the loans it will reimburse the holder of the securities losses.

The paper, which says Shuvalov, is not new for the market, it’s just an improved version of the former mortgage-backed securities that banks issue and now within the framework of securitization. Now these editions have a rather complicated structure: they have several tranches of different mortgage paper release agents, they are not standardised, said the press service AHML. As a result, the investor is quite difficult to understand what distinguishes one edition from another. “We propose to produce a simple, standard odnomarshevoy paper from the balance of one mortgage agent — a subsidiary of AHML”, — said there.

The difference between the new paper is also that the risks for non-payment of coupon yield or repay the nominal value will take on the seller, not the Bank, said the press service of the Agency, adding that the Agency is now working with the TSB to change the standards for the deduction of reserves for securities guaranteed by AHML.

The first Deputy Chairman of the Bank housing Finance Igor Zhigunov believes that an important advantage of this paper is the possibility of expanding access to primary lenders — banks for cheaper funding, which could affect the lower rates for borrowers on loans. On the need to reduce mortgage rates at the meeting of the state Council once again reminded President Vladimir Putin.

Risks from real estate

To say that the covering of outstanding liabilities, the seller is the distribution of budget money, wrong, says the press service AHML. “The fact is that when we issue a guarantee, the seller assumes the obligation to pay funds in the event of default on the bonds, and then ultimately perhaps the foreclosure of the collateral and receipt of funds from the sale of real estate” — believe there.

The Agency believes that it is technically impossible to proceeds from the sale of collateral were less than the money spent of the seller. “In particular, the law on mortgage-backed securities there is a requirement that the ratio of collateral should be above 80%. This means that in any case will be covered by all liability after foreclosure on the collateral,” — said the Agency.

Says Vice-President of Association of regional banks of Russia Oleg Ivanov, the scheme, which uses AHML, in the sense of trying to repeat the scheme, which was used in the Management of housing loans in the United States, but without guaranteeing each individual loan. “However, in Russia will not repeat the history of 2008 in the US, falling real estate prices, in my estimation, should not exceed 20-30%,” — said Ivanov.

According to Zhigunov, the risk, which takes care of the seller in case of a possible reduction in property prices, not so great. “First, the risks reduce the ratio of Deposit and loan mentioned above. Secondly, when the banks evaluate the collateral, they initially approach the assessment more conservative and, as a rule, can reduce the cost by 10-15% from the current market,” says Zhigunov.

However, it is important to understand what mortgage-backed securities is a long — term product, and to predict for the long term, what will happen to the property market and the macro economy, is hard enough, so the risks always remain, emphasizes the Zhigunov.

Unpopular mortgage

In 2015, the number of banks offering new residential mortgage loans declined significantly, the article reads “the condition of the market of mortgage lending in 2015,” published by the Central Bank on Wednesday.

By January 1, 2016, according to the Bank, the mortgage loans in total were engaged in 559 credit institutions. But realistically, to loan there were only 433 of them. Others simply continue to service previously issued loans. During the year the share of banks, where you can really get a new loan for house purchase fell from 85 to 77% of those credit orgnizatsiya that deal with mortgage.

Against the background of high interest rates on loans and falling incomes of the population (according to Rosstat data, they have decreased over the 10 months of 2015 to 3.5%), fell and the volume of newly issued loans. In 2015, credit institutions have issued about 700 thousand housing loans (30% less than the previous year) totaling 1161,7 billion rubles (34% less than in 2014).

Their share in total loans granted to individuals amounted to about 20%, as compared to the previous year by 0.6 p. p. the Average size of loans has decreased from 1.74 to 1.66 million rubles, while in Moscow, he made up 3.63 million RUB.