‘We keep on developing our mortgage lending sector and have recently reviewed our products’ standards in terms of risks and borrower requirements. URSA Bank decreased the cost of its mortgages by 2% in June 2008, so now if you take a mortgage for three to thirty years and make a 10% down payment, the average annual interest rate will amount to 15%. One can apply for anything between 100,000 RUR and 15 million RUR,’ URSA Bank’s Ural branch’s Vice President Alexei Sannikov says.

‘We managed to make the interest rate go down due to the loan financing becoming less expensive; for one, we borrowed $36m from BSTDB for our mortgage lending policies development,’ he adds.

‘At the moment, the mortgage lending market is peculiar in that people tend to apply for fewer mortgages they need to buy some estate they would like to let; at the same time, they do apply for more mortgages they need to improve on their own living conditions,’ Sannikov notes.

‘In case the Mortgage Lending Agency keeps cutting down on its refinancing offers, some smaller banks that used to work as agents will have to quit. The market will get redistributed among the larger players that have access to funding. On the other hand, the smaller banks could just become the major players’ agents.’

According to RBC.Rating’s data available as of January 1, 2008, URSA Bank is one of Russia’s top ten banks in terms of mortgage portfolio: this came to $860m (calculated on the basis of the international accounting standards) at the beginning of the year.