The liquidity crisis that came from America has at least one positive side: loans will be cheaper for reliable borrowers

Against the backdrop of a widespread increase in the cost of mortgage loans in Russia, Expobank in February of this year reduced rates in dollars by 0.5% - now money can be borrowed to buy an apartment at 9.25% per annum. Not the cheapest option on the market, but something else is noteworthy: Expobank’s actions run counter to the actions of most competitors.

For example, VTB-24 in February increased rates on loans for the purchase of housing by 0.5%. In March, UniCredit Bank loans became 1–1.5% more expensive, and Raiffeisenbank did the same. “The cost of money is rising, business profitability is falling,” the manager of one of the foreign banks shrugs.

However, Expobank (recently bought by British Barclays) believes that loans can be made cheaper for some borrowers. Who are we talking about? The reduction in rates affected only those who are employed, can confirm their income and make a 15-20% down payment. “This is the most widespread and low-risk category of borrowers,” the bank explains. It is for such clients that banks may start fighting for them in the near future. In times of financial crises, competition for reliable borrowers intensifies.

The credit crisis that hit America last year has left bankers and investors around the world very scared. A little less than a year ago, it suddenly became clear that there were too many bad mortgage loans in the United States. And the obligations on them, packaged in bonds with high ratings from world agencies, are worth nothing. The amounts that Merrill Lynch ($22 billion) or Citigroup ($18.1 billion) are now writing off on these bonds are comparable to the size of the Russian mortgage market. Total recognized losses on mortgage-backed securities are approaching $100 billion. Preparing for the worst, American and European banks reduced active operations around the world last year.

In September, the liquidity crisis reached Russia. The average daily balances of banks on correspondent accounts and deposits with the Central Bank, which amounted to 1.6 trillion rubles in June, decreased by more than two and a half times. In the summer and autumn of last year, many banks reduced the growth rate of their retail loan portfolio, including URSA Bank, Vozrozhdenie, Trust, Russian Standard, Moskommertsbank, Uniastrum Bank, etc.

Banks have tightened requirements for borrowers, and obtaining loans has become more difficult. When considering an application for a consumer loan, the bank assigns each client a rating that reflects the likelihood of his default. Large banks usually use the Experian scale (developer of scoring systems) for this assessment, which determines the borrower’s risk level in points - from 300 (highest risk) to 700 (lowest).

Depending on the number of points, a decision is made to issue a loan. If last summer it was enough to score 400 points to obtain a consumer loan in Moscow, then since the fall the bar has risen to 500–600. The difference in mortgage loan rates for reliable and risky clients was only 0.5–1% six months ago, but has now increased to 2–3%, states Nikolai Korchagin, CEO of the credit broker Creditmart. Having fallen under the cold shower of the crisis, banks began to better understand that rates should depend on risk, says Alexander Koloshenko, chairman of the board of Extrobank (a subsidiary of the Spanish Santander Consumer Finance).

Recently, GE Money Bank (a subsidiary of the American GE Money) began issuing ruble loans to clients with a good credit history for the purchase of housing at a rate of 10% per annum, despite the fact that rates on ruble mortgage loans today are at the level of 11–14% per annum. A potential client of GI Money must have income confirmed by a personal income tax-2 certificate, funds for a down payment (from 20% of the cost of housing) and a certificate from any bank about the repayment of a previously taken out loan.

However, only employees of large and well-known companies can receive money at 10%, assures an expert from a Moscow credit broker. According to him, for an employee of a small company, the bank will most likely reduce the loan amount by 20-25% or refuse it altogether: “It is a prudent policy to give the best conditions only to the best borrowers.”

“For a bank, a positive credit history is a halo over the borrower’s head,” confirms Nikolai Korchagin. City Mortgage Bank board member Mikhail Busygin says that over time, rates for prime borrowers may drop even further: “Such clients are interesting, if only because the loans issued to them are easier to sell or securitize.” In the future, the difference in rates for the best and worst borrowers may increase to 8–10%, Busygin predicts.

In the West, loan rates depend on the borrower's rating more than in Russia. At the beginning of March, an American with a lower credit rating could take out a car loan at 15% per annum, and with a higher one at 6.3%, notes Alexey Kordichev, deputy director of the retail business department at Rosbank.

Each bank is guided by its own ideas about a good client. But there are also general rules. Large banks rarely issue loans to people under 20 years of age. At the same time, the rating increases with the age of the borrower, but after 40–45 years it decreases. The amount of points scored increases the presence of working family members, an apartment and a car. It is important to understand that banks give preference not to rich, but to stable borrowers. All other things being equal, a large dividend income from stocks is worse than a stable salary.

For representatives of some professions, a loan is cheaper. Orgresbank employees, for example, consult with headhunters to understand which professions are in demand today. Deputy Chairman of the Board of Orgres Mikhail Polyakov notes that lawyers and financiers are now popular in the labor market. Officials usually receive a low credit score. In addition, after the crisis, banks began to especially value whether a potential borrower has a higher education diploma.

Difficulties are not for everyone