Uzbekistan_Support to the Operationalization of the Uzbekistan Mortgage Refinancing Company

The objective of the assignment is to support the Government of Uzbekistan  to operationalize the Uzbekistan Mortgage Refinancing Company (UMRC) by developing constitutive documents, strategy, systems, and policies. The UMRC is envisaged to be a wholesale financial institution providing long-term finance to mortgage lenders. It issues bonds in the capital markets, and with the proceeds, provides long-term loans to mortgage lenders. It bridges the maturity mismatch which lenders face when trying to do long-term lending using their short-term deposits. It is therefore important that the constitutive documents, strategy, systems, and policies are developed in line with international best practices.

Qualifications: 

The Legal Expert is expected to:

Establish UMRC as a company:

  • Assess company licensing procedure;
  • Prepare action plan with all steps for setting up UMRC as a company including key milestones to be completed before moving to next phase;
  • Prepare necessary documentation and registrations for UMRC;
  • Prepare Memorandum and Articles of Association;
  • Prepare necessary documentation for prospective shareholders to sign and put in initial shareholder equity; and
  • Draft—in conjunction with the housing finance expert - the Master Refinance Agreement to govern the relationship between UMRC and its client financial institutions, as well as possible related agreements.

Create necessary regulatory framework for UMRC as a regulated financial institution:

  • Assist MOF and Central Bank of Uzbekistan (CBU) in drafting legislative amendments (new category of FI, CBU supervision) to the extent needed;
  • Identify all documents that are necessary to obtain the license from CBU, and prepare those that do not require prior decision or approval from the future CEO and Board; and
  • Implement all the necessary processes and procedures to obtain the license from CBU.

Assess the mechanism to gain security over refinanced mortgages:

  •  Option 1: Assessment of different mechanisms by which UMRC could get a priority ranking over a mortgage portfolio in the case of bankruptcy of a lender;
  • Option 2: Assessment of legal possibility for fully transferring mortgages from lender to UMRC;
  • Detail costs and benefits for each option including tax implications, cost, time - considering the dynamic nature of the collateral (periodic replacement of NPLs), strength of legal mechanisms - including overcollateralization, and credibility of the process for enforcing the collateral;
  • Determine the concrete conditions for perfecting the collateralization mechanism.
  • Determine the ranking of UMRC vis-à-vis other creditors of the borrowing bank, particularly depositors, salaried staff and the tax administration; and
  • Determine the capacity of UMRC to execute individual mortgages in the case of repossessed portfolios.
Start / Duration: 

The expected implementation of the Technical Assistance is from March 2019 to December 2020

If you are interested to cooperate with AFC Consultants please send you most recent CV to Barbara.Braun [at] afci.de  

Thank you