1 An overview of the Russian securitization market – key trends and outlook for 2008 Dr. Alexander V. Chernyak CEO ATTA Mortgage LLC Russian Securitization Forum New York 10 September 2007

2 2 I. Status and Perspectives of Mortgage Loan Market in Russia

3 3 Housing Market Status Housing Availability Level in Different Countries Forecast of dynamics of purchase and sale transactions in RF 61% of Russian families need improvements of their housing conditions Transactions at secondary market Transactions at primary market USA Great Britain Germany France Russia Square meters per men thousands

4 4 Forecast of Mortgage Loans

5 5 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

6 6 II. Status and Perspectives of Russian Mortgage-backed Securitization

7 7 Securitization in Russia Volume of Securitization in Russia by Year Russian Securitization by Asset Class in 2007:H1

8 8 Estimates of Refinancing Mortgage Product Market Share Parameter Volume of issued mortgage loans 2,1966,27515,68631,37354,90282,353102,941 Loan volume, kept by lenders 1,5693,7657,84314,11821,96128,82430,902 Volume of mortgage loans to be securitized 6272,5107,84317,25532,94153,52972,039 Share of securitized mortgage loans Million of dollars

9 9 Securitization Perspectives

10 There were already a number of notable features in Russian securitization market in 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 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

11 III. АТТА Mortgage - Example of Successful Refinancing Company

12 The position of ATTA Mortgage on the refinancing market * Source: http// Volume, $млн. * Excluding АHML: In the market since , refinanced $1685,9 млн. ATTA Mortgage  ATTA Mortgage was established by Turan Alem Bank finance group as a limited liability company in May,  ATTA Mortgage began to buy mortgage loans in October  According to the Charter the main aim of the company is the activity in refinancing of mortgage loans in Russia and abroad.

13 -Regions of Russia, where ATTA Mortgage has partners: 99 partners in 81 republics and regions of the RF Investors Re-financing company Providers of mortgages Mortgagees Mortgage borrowers Pension fund Mutual funds Investors to mortgage bonds (MBS) ATTA Mortgage Mortgage dealers Banks Mortgage brokers Co-operativesOthers Collectors agencies Depositories Servicers companies Insurance companies The scheme of the of mortgage market participants with ATTA Mortgage The scheme of the cooperation of mortgage market participants with ATTA Mortgage Territorial Coverage ATTA Mortgage

14 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  Obtaining the rating.

15 ATTA Mortgage  Russian Federation, , Moscow, Usievicha str, 20, bldg.1  tel. + 7 (495)  fax + 7 (495) , ext  