The Federal Law dd. 30 December 2015 No. 461-FZ “On Amending of Art. 17 of Federal Law “On the Securities Market” and of Federal Law “On Mortgage Securities” came into force on 10 January 2016. The law was initiated by the Agency for Housing Mortgage Lending and drafted by Banking & Finance, Capital Markets Practice of Egorov Puginsky Afanasiev & Partners.
In addition to drafting, the team was involved in the process of its approval, and was part of the Bank of Russia’s working team.
Application of the provision of the law will open up further opportunities in terms of securitization of housing loans, encourage further development of mortgage lending and, consequently, will make housing more affordable.
It is possible to achieve these goals thanks to the following legislative changes:
- It is now possible to register mortgage-backed housing bonds as program bonds: the deadlines for implementation of recurrent mortgage securitization of housing loans may be substantially reduced.
- Mortgage-secured bonds are now covered by limited recourse provisions: transaction documents may provide for termination of the mortgage agent lenders’ obligations not satisfied with the funds raised through realization of mortgage security when enforced.
- Removal of restrictions on structuring transactions involving a revolving mortgage asset pool: the regime for substitution of the claims within the mortgage security has been liberalized.
The team included senior associate Oleg Ushakov, associates Maria Kondratskaya, Alexander Filchukov and Gilyana Haraeva, as supervised by partner Dmitriy Glazounov.