• Overview
• Structuring the transaction, joint participation with the organizer in the analysis and drafting the transaction scheme
• Legal supervising the setting up of a mortgage agent
• Legal supervising the transfer of mortgage bonds to a mortgage agent
• Financing and payments
• Legal supervising the issue of mortgage-backed bonds
• Supervising the disclosure of information at the stages of mortgage-backed bonds issue
• Giving legal opinion on the transaction including
• Legal supervising the granting of transaction sureties by the Housing Mortgage Finance Agency
• Legal supervising the procedure of putting mortgage-backed bonds into the Lombard list of the Bank of Russia

Legal company "Nektorov, Saveliev and Partners" managed to make up a team of lawyers who are unique and rare specialists in the sphere of assets securitization. Under their supervision and with their participation the first transactions on mortgage assets securitization were executed in Russia.

Our lawyers have accumulated priceless practical skills in the sphere of legal consulting on securitization transactions as well as experience in cooperation with all participants of such transactions. So, we can recommend to our clients the decisions that would be the most reasonable and the least costly.  

Nowadays, under the Russian law one can execute transactions on mortgage assets securitization in accordance with the provisions of the Federal Law dated from 11.11.2003 No152-FZ "On mortgage securities" by means of the issue of:

• mortgaged–backed bonds;
• mortgage certificates of participation.

Securitization of other assets (non-mortgage) is not directly provided but is not prohibited by the current Russian legislation.

For example, it is possible to structure transactions on securitization of non-mortgage assets on the basis of the general norms of the  RF Civil Code and Federal Law dated from 22.04.1996 No39-FZ "On securities market".

But in the present economic situation it is the securitization of mortgage assets that represents one of few effective methods to mobilize financing and re-financing of the formed mortgage bonds pool, as on such bonds one can acquire sureties from the Housing Mortgage Finance Agency. Sureties from the  Housing Mortgage Finance Agency allow to enter the mortgage-backed bonds into the Lombard list of the Bank of Russia which gives access to financial resources of the Bank of Russia as the bonds can become a guarantee when obtaining credits (intraday, overnight, lombard) from the Bank as well as to become a transaction subject of direct  REPO.

The lawyers from "Nektorov, Saveliev and Partners"  are ready to help you in turn-key drafting your transaction on mortgage assets securitization. For example, while supervising an out-of-balance securitization transaction we usually provide our clients with the following services:

• determination of the transaction participants (depositary, specialized depositary, trade organizer in the securities market (stock exchange), service agent, alternate service agent, payment agent, calculating agent, rating agency, etc. (if necessary);
• determination of a person(s) who become(s) a mortgage agent’s founder(s);   
• drafting the structure of contractual relations on the transaction among its participants;
• drafting a model (parameters) of the bond issue (total nominal value of the mortgage-backed bonds, the number of grades, mechanism of subordination, cash flow, etc.)
• determination and legal analysis of other material characteristics of the transaction.   

Setting up of mortgage agent’s shareholders:

• drafting recommendations on the country of incorporation of mortgage agent’s shareholders;
• drafting corporate documents of mortgage agent’s shareholders;
• legal supervising setting up mortgage agent’s shareholders;
• drafting a covenant on the part of mortgage agent’s shareholders and the managerial company.

Preliminary agreement of an antimonopoly organ on setting up a mortgage agent (if applicable):

• drafting documents necessary for acquisition of preliminary agreement of an antimonopoly organ on setting up a mortgage agent.

Setting up a mortgage agent:

• drafting a charter of a mortgage agent;
• drafting a contract on setting up a mortgage agent;
• drafting documents necessary for state registration of a mortgage agent;
• supervising state registration of a mortgage agent;
• supervising the process of mortgage agent’s registration in extra-budgetary funds (Social Insurance Fund of the Russian Federation,       Pension Fund of the Russian Federation, Federal Compulsory Medical Insurance Fund, statistical bodies); drafting documents necessary for making and registration of a mortgage agent’s stamp  in Moscow SUE "Moskovsky Reestr" ("Moscow Register"); 
• supervising the process of making and registration of a mortgage agent’s stamp.

Preliminary agreement of an antimonopoly organ on acquisition of rights to perform the functions of a mortgage agent’s  executive organ (if applicable):

• drafting documents necessary for obtaining preliminary agreement of an antimonopoly organ on concluding a contract on transferring the functions of a mortgage agent’s sole executive organ to the managerial company;
• supervising the acquisition from an antimonopoly organ   preliminary agreement on concluding a contract on transferring the functions of mortgage agent’s sole executive organ to the managerial company.

Transferring the authority of a mortgage agent’s sole executive organ to the managerial company:

• drafting and coordination of a contract on transferring the functions of mortgage agent’s sole executive organ to the managerial company;
• drafting documents necessary for conducting a general meeting of mortgage agent’s shareholders to approve the contract on transferring the functions of mortgage agent’s sole executive organ to the managerial company as a major transaction and non-arm’s length transaction.

Transferring the functions of a mortgage agent’s bookkeeper to an accounting company:

• drafting and coordination of a contract on service on maintaining accounting and tax records;
• drafting documents necessary for the conduction of a general meeting of mortgage agent’s shareholders to approve the contract on maintaining  accounting and tax records as a major transaction and non-arm’s length transaction.

State registration of mortgage agent’s share issue within its foundation:

• drafting the decision on securities issue and a report on the results of a mortgage agent’s securities issue;
• drafting decisions of a mortgage agent’s authorized organs on approving the decision on securities issue and the report on the results of a mortgage agent’s securities issue;
• drafting an issuer’s form of a mortgage agent;
• drafting other documents necessary for state registration of securities issue and a report on the results of a mortgage agent’s securities issue;
• supervising state registration of a mortgage agent’s securities issue.

Further procedures:

• coordination of the contract on audit services;
• coordination of contracts of mortgage agent’s banking account (transaction account, account for funds making up the mortgage pool). 

Preliminary agreement of an antimonopoly organ on the transfer of mortgage bonds to a mortgage agent (if applicable):

• drafting documents necessary for obtaining from an antimonopoly organ of preliminary agreement on the transaction (several transactions) on acquisition of mortgage  bonds by a mortgage agent;
• supervising the obtaining from an antimonopoly organ of preliminary agreement by a mortgage agent on the transaction (several transactions) on acquisition of mortgage bonds by a mortgage agent.

Drafting necessary contracts:

• drafting and coordinating of a contract on mortgage bonds purchase and sale;
• drafting and coordinating of an act on mortgage bonds purchase and sale;
• drafting and coordinating of a contract with a specialized depositary that executes control over the mortgage cover;
• supervising and coordinating the contract with a reserved specialized depositary that executes control over the mortgage cover in case a specialized depositary is unable to execute such a control;
• drafting and coordinating the contract with a mortgage agent that maintains service on mortgage revenues;
• drafting and coordinating the contract with a reserved service agent that maintains service on mortgage revenues in case the service company is unable to render such services.

Legal supervising the mortgage bonds transfer:

• consulting on executing mortgage endorsements;
• legal supervising the mortgage bonds transfer from the originator to a mortgage agent.

• drafting and coordinating a contract on a calculating agent;
• drafting and coordinating a contract on a payment agent;
• drafting and coordinating a contract on services on bonds issue\contract on mortgage-backed bonds placement;
• drafting and coordinating a contract on purchase and sale of low-grade bonds;
• coordinating a contract on granting a subordinate loan.

• drafting and coordinating contracts with the depositary that executes mandatory centralized lodging of mortgage-backed bonds certificates;
• drafting a decision on mortgage-backed bonds placement;
• drafting a decision on mortgage securities issue;
• drafting securities prospectus;
• drafting a decision on approving the decision on mortgage securities issue;
• drafting a decision on approving the securities prospectus;
• drafting other documents necessary for state registration of mortgage-backed bonds issue;
• supervising state registration of mortgage-backed bonds issue;
• drafting documents on mortgage-backed bonds placement (decision on the coupon interest in  the first coupon period, on the starting date of mortgage-backed bonds placement, etc.);
• drafting documents necessary for putting  mortgage-backed bonds into stock exchange quoting lists (MICEX, RTS);
• supervising putting of  mortgage-backed bonds into stock exchange quoting lists (MICEX, RTS);
• drafting a report on the results of mortgage securities issue;
• drafting other documents necessary for state registration of the report on the results of mortgage securities issue;
• supervising state registration of the report on the results of mortgage-backed bonds issue.

• information disclosure in the course of the transaction;
• drafting press-release projects;
• drafting message projects and material facts projects.

• legal expertise of the originator’s due incorporation;
• legal expertise of the authorities of those who act on behalf of the originator and other Russian participants of the transaction in the course of concluding and executing  the transaction (several transactions) on acquisition of the mortgage bonds by a mortgage agent;
• legal expertise of compliance with the Russian law of all corporate procedures due to be executed by the originator and other Russian participants of the transaction  in order to conclude and execute the transaction (several transactions) on acquisition of mortgage bonds by a mortgage agent;
• legal expertise of legal documents (including the mortgage form) used by the originator for the issue of loans on mortgage on their compliance with all norms of the Russian law;
• legal expertise of the procedure of transferring mortgage rights and assessment of neighboring risks that may influence the execution of obligations on the transaction;
• analysis of possible legal bankruptcy risks of the originator and other Russian participants of the transaction and the degree of their influence on obligations on the transaction and the transaction (several transactions) on acquisition of mortgage bonds by a mortgage agent;
• legal expertise of other material issues of the transaction;
• coordinating the project of legal opinion on the transaction with a rating agency.  

If necessary "Nektorov, Saveliev and Partners" Law company can give legal advice on executing the transactio.