Bank of Moscow sold RUB4.69 billion ($99 million) of securities backed by Russian residential mortgages to private investors.
The deal, which was led by VTB Capital, was oversubscribed and priced tighter than initial guidance, according to a press release issued by the bank. Initial price guidance on the deal ranged from 10.45% to 11.00% coupon per annum. The RUB 3.7 billion senior tranche, rated Baa3’ by Moody's Investors Service, priced at a coupon rate of 10.65%.
The securities were placed among Russian investors “outside the scope of the government’s mortgage assistance programs,” including pension funds, asset management and insurance companies, VTB's release stated.
“The order book was oversubscribed, which is considered a notable success given the current market conditions,” said Andrey Suchkov, head of securitization at VTB Capital, said in the release.
The Agency for Housing Mortgage Lending (AHML) is the backup servicer.
AHML, along with Vnesheconombank (VEB), have mortgage assistance programs and are typically buyers of Russian RMBS. AHML, this year, confirmed its annual repurchase program of RUB40 billion while VEB has about RUB66 billion left for its RMBS investment program, which is slated to wind down this year.