1

An overview of the Russian An overview of the Russian securitization market – key trends securitization market – key trends

and outlook for 2008and outlook for 2008

Dr. Alexander V. ChernyakDr. Alexander V. ChernyakCEOCEO

ATTA Mortgage LLCATTA Mortgage LLC

Russian Securitization ForumRussian Securitization Forum

New YorkNew York 10 September 10 September 2007 2007

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I. Status and Perspectives of

Mortgage Loan Market in Russia

33

Housing Market Status

кв. м на 1 чел.

0

10

20

30

40

50

60

70

80

США Великобритания Германия Франция Россия

Housing Availability Level in Different Countries

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

2007 2008 2009 2010 2011

ты

с.

Сделки на вторичном рынке

Сделки на первичном рынке

Forecast of dynamics of purchase and sale transactions in RF

61% of Russian families need improvements of their housing conditions

Transactions at secondary marketTransactions at primary market

USA Great Britain Germany France Russia

Square meters per men

thousands

44

Forecast of Mortgage LoansForecast of mortgage loan issuance

0.0

20.0

40.0

60.0

80.0

100.0

120.0

2005 2006 2007 2008 2009 2010 2011Years

Billions of dollars

Mortgage loans (annually)

Forecast of mortgage loan mean volume

0.0

20.0

40.0

60.0

80.0

100.0

2005 2006 2007 2008 2009 2010 2011Years

Thousands of dollars

Average size

Forecast of the number of issued mortgage loans

0

200000

400000

600000

800000

1000000

1200000

1400000

2005 2006 2007 2008 2009 2010 2011Years

Number

Number (annually)

Comparison of growth coefficients

0.00

0.50

1.00

1.50

2.00

2.50

3.00

2006 2007 2008 2009 2010 2011 Years

Coefficients

Increase of volume Increase of size

Increase of number

55

The basis for formation and development of three models of the mortgage market was laid:

- closed – a system of loan saving accounts in which resources for mortgage loans are formed by means of savings and government subsidies;

- single-level – primary creditors are issuers of mortgage securities;

- double-level – special “refinancing companies” and largest banks with wide net of branches assure liquidity of small and medium creditors through buying out mortgage assets and issue collateral mortgage securities.

In fact, all actual mortgage programs are oriented to securitization of mortgage assets, which determines a priority of development of the double-level model.

Three Models

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II. Status and Perspectives of Russian

Mortgage-backed Securitization

77

Securitization in Russia

Volume of Securitization in Russia by Year

Russian Securitization by Asset Class in 2007:H1

88

Estimates of Refinancing Mortgage Product Market Share

Parameter 2005 2006 2007 2008 2009 2010 2011

Volume of issued mortgage loans 2,196 6,275 15,686 31,373 54,902 82,353 102,941

Loan volume, kept by lenders 1,569 3,765 7,843 14,118 21,961 28,824 30,902

Volume of mortgage loans to be securitized

627 2,510 7,843 17,255 32,941 53,529 72,039

Share of securitized mortgage loans

0.29 0.40 0.50 0.55 0.60 0.65 0.70

Million of dollars

99

Securitization Perspectives

Predicted structure of mortgage assets

0

20,000

40,000

60,000

80,000

100,000

120,000

2005 2006 2007 2008 2009 2010 2011Years

million of dollars

Securitisized loans Unsecuritisized loans Volume of the market

1010

There were already a number of notable features in Russian securitization market in 2007. Among these were:

- Agency for Housing and Mortgage Lending’s (AHML) first RMBS transaction, which was the first domestic transaction using tranching

- Raiffeisen’s $400 million auto-loan deal that was the first in its asset class to achieve a single A rating in Russia

- DeltaCredit’s RMBS transaction that was the first in Russia to use a principal deficiency ledger (PDL) mechanism

- Sovfintrade’s (Gazprombank’s) second off-shore RMBS

In 2008 we can forecast growing interest from western and domestic investors in Russian structured bonds, therefore we can expect to see continued growth in Russian securitization.

Many banks and non-banking organizations (including ATTA Mortgage) plan to begin or continue their securitization programs in 2008 (taking into account global economic circumstances now).

The increasing popularity of warehousing and the timing of refinancing of these warehouses through term securitizations, as well as spread trends on newly issued bonds will determine the volume of issued bonds for 2008.

It is expected continued diversity in the types of asset classes that are included in securitization, as for example interest in CMBS and credit card transactions picks up.

Securitization in Russia in 2008

1111

III. АТТА Mortgage -

Example of Successful Refinancing

Company

ATTA 12

The position of ATTA Mortgage on the refinancing market*

АТТА Mortgage

KIT Finance

Eurotrust

GPB-Mortgage

Uniastrum Bank

Bank Vozrozhdenie

RaiffeisenbankVTB24Absolut

Bank0

100

200

300

400

15 25 35 45 55 65 75

In the market, months

Source: http//www.rusipoteka.ru/

Volume, $млн.

* Excluding АHML: In the market since 09.1997, refinanced $1685,9 млн.

ATTA Mortgage

ATTA Mortgage was established by Turan Alem Bank finance group as a limited liability company in May, 2005.

ATTA Mortgage began to buy mortgage loans in October 2005.

According to the Charter the main aim of the company is the activity in refinancing of mortgage loans in Russia and abroad.

1313

-Regions of Russia, where ATTA Mortgage has partners: 99 partners in 81 republics and regions of the RF

Investors

Re-financing company

Providers ofmortgages

Mortgagees

Mortgage borrowers

Pension fund

Mutualfunds

Investors to mortgage bonds (MBS)

ATTA Mortgage

Mortgage dealers

Banks

Mortgage brokers

Co-operatives Others

Collectors agencies

Depositories

Servicerscompanies

Insurance companies

The scheme of the The scheme of the cooperation of mortgage market participants with ATTA Mortgage of mortgage market participants with ATTA Mortgage

Territorial CoverageATTA Mortgage

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ATTA Mortgage strategy Fast entry to primary and secondary mortgage markets. Long-term cooperation with all kinds of participants of mortgage

market. Training of the participants of mortgage market in technologies of

giving, re-financing and serving mortgage loans on the basis of ATTA Mortgage own educational centre.

Establishing of universal IT-system, connecting all the participants.

Organization of all-Russia mortgage program, including banks, mortgage agents, insurance and appraiser companies etc.

Entry to international capital markets. Maintenance of Company share of mortgage market – 10%. Securitization of mortgage assets, issuance first MBS for Russian

and foreign investors in 2008. Obtaining the rating.

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ATTA Mortgage

Russian Federation, 125190, Moscow, Usievicha str, 20, bldg.1

tel. + 7 (495) 783-28-45 fax + 7 (495) 911-96-42, 783-28-43 ext. 2227 e-mail: avch@attaipoteka.ru, info@attaipoteka.ru www.attaipoteka.ru