Moody's Rates Russian RMBS

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Russia's Agency for Housing Mortgage Lending (AHML) issued its sixth securitization of Russian residential mortgage loans that has been rated by Moody's Investors Service.

The deal, AHML 2012-1, will securitize 13.2 billion rubles ($414 million) of RMBS fixed rate bonds. Moody's has assigned the Class A notes a 'Baa1' rating and the class A2 notes a 'Baa3' rating.

All loans are secured by Russian mortgage certificates ("zakladnaya"), which have been transferred to the issuer. The loans have been originated by a range of local regional banks and non-banking entities according to standards set by the AHML.

AHML performs various roles in the transaction such as servicer, back up cash manager, and financial assistance provider; the collection accounts are also in the name of AHML. This means that the notes are heavily exposed to the credit of AHML.

The European Bank for Reconstruction and Development noted in an early July report that mortgage lending is growing in Russia. In 2011, the annual volume of mortgage lending in the country jumped to a record of 713 billion rubles, an 87% increase over the prior year.

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