16 Dec 2009 17:41

VEB, AHML buy up over half of VTB 24 mortgage-backed bonds

MOSCOW. Dec 16 (Interfax) - Vnesheconombank (VEB) and the Agency for Home Mortgage Lending (AHML) bought more than half Monday's placement of VTB 24 mortgage-backed bonds in the amount of 15 billion rubles, VTB 24 President and chief executive Mikhail Zadornov told reporters on Wednesday.

The bid book for the VTB 24 series 1-IP bonds was closed on Monday, with a first-coupon rate set at 9.7%. The bonds were placed on the MICEX on December 16.

Only 60% of the AHML bids were fulfilled, Zadornov said.

The remainder of the issue not purchased by AHML and VEB were acquired by market players. The mortgage-backed bonds attracted more than twenty investors, including banks and management companies, he said.

"We received an absolutely market instrument - liquid money under mortgage," Zadornov said.

The bank has been increasing its mortgage-backed bond placement activity lately, Zadornov said. "Of the mortgage portfolio of 173 billion rubles, 50 billion rubles is already bonds. In placing them, we are not only making revenue, we are also reducing interest risks," he said.

VTB 24 will place at least 500 million rubles worth of mortgage-backed bonds in 2010, he said.

Zadornov declined to give any other details of the bond placement, but did say that the bank plans to securitize its auto-loan portfolio of $300-$500 million. Japanese banks are likely to be involved in that deal, but VTB 24 has not yet made a final decision on whether it will be market securitization.