The article considers the external mechanism of credit support for Russian housing mortgage bond issues, i.e. mortgage insurance. The author states that this type of insurance focuses on covering capital losses on bank loans. The insurance has a long history of evolution in developed mortgage markets and a special regulation, which is necessary for banking risk transfer to the insurance sector to prevent an imbalance in the financial system. Without changing the economic substance of credit risk insurance on mortgage loans, the configurations of insurance cover differ in terms of insurance size and conditions depending on regulation of banking and insurance sectors in various countries. Given the specifics of insurance cover applied in transactions with mortgage-backed securities (MBS), the author assesses the impact of mortgage insurance on the MBS credit quality and cost. The conclusion is that the mortgage is an exclusively significant factor of economy and social stability development. However, compared with many developed and emerging markets, this segment is still rather weak in Russia: the capital market is not interested in it. As for the banks involved in securitization, they often make transactions beyond their capacity, incurring considerable expenses and undertaking the load on their capital without improving their positions on the primary market. Therefore, there is a need for innovation mechanisms stimulating capital mobilization in this segment, which will eliminate long-term risks from balance sheets of banks and contribute to reducing interest rates on mortgage loans. The study demonstrates that the mortgage insurance may become the required stimulating mechanism.
Davidson A., Sanders A., Wolff L.-L., Ching A. Sek'yuritizatsiya ipoteki: mirovoi opyt, strukturirovanie i analiz [Securitization: Structuring and Investment Analysis]. Moscow, Vershina Publ., 2007.
El'tsov M.I. Perspektivy razvitiya ipotechnogo kreditovaniya v Rossii [Development prospects of mortgage lending in Russia]. St. Petersburg, Nestor Publ., 2000, pp. 65–66.
Kopeikin A., Stebenev L., Skorobogat'ko B., Penkina I. Razvitie ipotechnogo kreditovaniya v Rossii [Development of mortgage lending in Russia]. Rynok tsennykh bumag – Securities market, 1998, no. 8, pp. 26.
Cook J. Razvitie ipotechnogo kreditovaniya na nyneshnei pravovoi baze [Development of mortgage lending on the current legal base]. Biznes i banki – Business and banks, 1995, no. 18, pp. 12–13.
Lavrukhin O.N. Ipotechnoe kreditovanie: real'nost' i perspektivy [Mortgage lending: reality and prospects]. Biznes i banki – Business and banks, 1995, no. 22, pp. 8–9.
Mashinistova E. Kreditnye instituty kak sub"ekty ipotechnykh operatsii s zhil'em [Credit institutions as subjects of mortgage housing operations]. Rossiiskii ekonomicheskii zhurnal – Russian economic journal, 1996, no. 7, pp. 47–56.
Tsyganov A.A., Yazykov A.D., Grishin P.A. Kanadskii opyt organizatsii sistemy ipotechnogo strakhovaniya [The Canadian experience of arranging a mortgage insurance system]. Strakhovoe delo – Insurance business, 2011, no. 5, pp. 44–50.
Yazykov A.D., Kamyshev A.V., Tsyganov A.A. Ipotechnoe strakhovanie kak instrument snizheniya kreditnykh riskov [Mortgage insurance as a tool to mitigate credit risks]. Den'gi i kredit – Money and credit, 2014, no. 3, pp. 12–14.
Proposed Amendments to the Russian Federal Mortgage Law to Develop Mortgage Insurance Are Credit Positive for Future RMBS Issuance, Sector Comment. Moody’s Investors Service, November 6, 2013.
Moody’s Approach to Rating RMBS Using the MILAN Framework. Rating Methodology. Moody’s Investors Service, March 25, 2014.
International Convergence of Capital Measurement and Capital Standards. A Revised Framework. Comprehensive Version. Basel Committee on Banking Supervision, BIS, 2006.
