Egorov Puginsky Afanasiev & Partners (EPAM) has announced that it advised the Housing Finance Bank (ZhilFInans) on the two transactions to securitize its mortgage assets (a transaction reported on by CEE Legal Matters yesterday).
According to EPAM, "each transaction involved placement of three classes of subordinated bonds by special purpose vehicles (mortgage agents). The senior tranche was placed by public offering, middle (mezzanine) tranche was placed for the benefit of the Agency for Housing Mortgage Lending OJSC, and the equity tranches for the benefit of Bank ZhilFinance, acting as the originating bank partially assuming the transaction risks."
The EPAM team advised on the introduction of the middle tranche into the deal structure, which mitigated the risk assumed by the originating bank and allowed it to increase the number of senior tranche bonds placed. The firm explained that "other specifics of the deal affecting the contents of the contractual and emission documents include depository accounting of the mortgage bonds constituting the mortgage coverage (the property pledged on bonds), as well as monthly bond coupons."
Ruslan Iseev, the Chairman of the Management Board at Bank ZhilFinance, commented that, “the successful completion of the transaction is an important step in implementing the bank's strategy, aimed at increasing pools of mortgages issued, refinanced and served by the bank."
EPAM Partner and Head of the Capital Markets Practice Dmitry Glazunov supervised the firm's team on the deal, assisted by Senior Associate Oleg Ushakov and Associate Vladimir Goglachev.