ACRA has affirmed the credit rating of JSC “DOM.RF” (hereinafter, DOM.RF or the Company) at AAA(RU), outlook Stable, and the credit ratings of the Company’s bond issues (BO-05, BO-06, BO-07, BO-08, BO-10, 001P-01R, 001P-02R, 001P-03R, 001P-04R, 001P-05R, 001P-06R, 001P-07R, 001P-12R, 002P-01, 002P-02, 002P-03) at AAA(RU).
DOM.RF’s credit rating is based on the very high likelihood of extraordinary support from the shareholder (hereinafter, the Supporting Entity or the SE) due to the Company’s exclusive importance to Russia’s economy and the determining influence that the SE has on its operations. At the same time, the factors of DOM.RF’s standalone creditworthiness are at a sufficiently high level.
In accordance with Federal Law No. 225-FZ dated July 13, 2015 “On promoting the development and increasing the efficiency of management in the housing sector and on introducing amendments to certain legislative acts of the Russian Federation”, DOM.RF performs the unique role of a unified housing sector development institution, the key areas of which include developing the mortgage-backed securities (MBS) market, financing housing construction through a specialized credit institution/authorized bank in the housing sphere, developing the construction of infrastructure, involvement in the turnover and provision of federally owned land plots for housing construction, developing the rental housing market, and developing a unified information system for housing construction.
ACRA expects that under a systemic economic stress scenario and/or if the Company’s standalone creditworthiness significantly deteriorates, the SE will provide the Company with extraordinary support in the form of capital and/or liquidity injections that are sufficient to meet creditors’ claims.
KEY ASSESSMENT FACTORS
Very high likelihood of extraordinary support being provided to the Company by the Supporting Entity. DOM.RF is a development institution which, according to its legal mandate, performs the unique function of developing and supporting the housing market in Russia. The Company is a strategically important institution. Improving housing conditions and developing housing construction are specified as priority development goals of the Russian Federation, and DOM.RF plays a key role in implementing these tasks. The Supporting Entity participates in determining the Company’s development strategy and supervises its operating activities. Other factors that confirm the social importance and exclusive role that DOM.RF plays in the economy include:
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The Company carries out social tasks in the housing sector, including acting as an operator of mortgage borrower support programs;
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Some of the bonds issued by DOM.RF are secured by the SE’s irrevocable guarantees;
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Securitization of mortgage loans with MBSs guaranteed by the Company, the potential default on which would mean significant financial and reputational losses for the SE;
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Developing an authorized bank in the housing sphere, with a focus on mortgage lending and project financing;
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Implementation of the program for financing infrastructure construction and reconstruction through project finance notes issued by SPVs and guaranteed by DOM.RF.
ACRA also notes the following factors that confirm the strong ties between the Company and the SE and the very high level of support: (1) the Company’s legal immunity against bankruptcy procedures; (2) the possibility and multiple examples of legally established support from the SE (including in 2022 and 2023) in the form of capital and via other instruments.
Factors of the Company’s standalone creditworthiness are at a sufficiently high level. DOM.RF has continued to increase its assets (+32% for the last 12 months to RUB 5.5 tln as of April 1, 2025), amid continuing growth of business profitability. At the same time, the volume of non-performing loans on the balance sheet is insignificant. The maintained liquidity buffer is assessed as comfortable, given the significant possibilities to raise funds if necessary.
In addition, DOM.RF consistently demonstrates positive financial results and its NIM and CTI continued improving in 2024. ACRA also notes that the Company has a sufficient capital cushion: according to the IFRS reporting, the N1 capital adequacy ratio for Q1 2025 was at a comfortable level — 13.8% (amid the minimum value (11.5%) established for DOM.RF). According to DOM.RF, maintaining capital adequacy above the regulatory established value and ensuring balanced growth of assets and capital will be carried out including at the expense of profits retained at the disposal of the Company for development purposes, as well as, to a lesser extent for now, within the framework of an additional share issue planned for the end of 2025. Previously, the SE increased the charter capital of DOM.RF, including by RUB 50 bln in 2022 and by RUB 87 bln in 2023. At the same time, ACRA draws attention to a noticeable slowdown in the rate of business growth amid lower activity in the residential construction market. The Company also complies with the standard maximum amount of risk per borrower or group of related borrowers, and financial leverage, for which calculation methods and compliance procedures (along with the N1 ratio) were established by the Russian Government in October 2020. A joint working group created by the Bank of Russia monitors DOM.RF’s financial standing.
These risks do not currently affect the Company’s credit rating given ACRA’s opinion on the very high likelihood of support from the SE to the Company if required.
KEY ASSUMPTIONS
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Maintaining the shareholder and operational control structure;
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Implementing DOM.RF’s strategy.
POTENTIAL OUTLOOK OR RATING CHANGE FACTORS
The Stable outlook assumes that the rating will highly likely stay unchanged within the 12 to 18-month horizon.
A negative rating action may be prompted by:
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Significant decline in the Company’s systemic importance to the Russian economy;
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Loss of shareholder and operational control by the SE;
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Decline of the factors of the Company’s standalone creditworthiness amid the SE’s propensity to provide regular and extraordinary support decreasing.
RATING COMPONENTS
Standalone creditworthiness assessment (SCA): none.
Adjustments: none.
Support: on par with the Russian Federation.
ISSUE RATINGS
1) JSC “DOM.RF”, BO-05 (ISIN RU000A0JX2R1); maturity date: December 22, 2049, issue volume: RUB 5 bln — AAA(RU).
2) JSC “DOM.RF”, BO-06 (ISIN RU000A0ZYF20); maturity date: November 7, 2050, issue volume: RUB 5 bln — AAA(RU).
3) JSC “DOM.RF”, BO-07 (ISIN RU000A0ZYF38); maturity date: November 7, 2050, issue volume: RUB 5 bln — AAA(RU).
4) JSC “DOM.RF”, BO-08 (ISIN RU000A0ZYFM5); maturity date: November 13, 2050, issue volume: RUB 5 bln — AAA(RU).
5) JSC “DOM.RF”, BO-10 (ISIN RU000A0ZYFN3); maturity date: November 13, 2050, issue volume: RUB 10 bln — AAA(RU).
6) JSC “DOM.RF”, 001P-01R (ISIN RU000A0ZYLU6); maturity date: December 13, 2027, issue volume: RUB 15 bln — AAA(RU).
7) JSC “DOM.RF”, 001P-02R (ISIN RU000A0ZYQU5); maturity date: January 21, 2028, issue volume: RUB 15 bln — AAA(RU).
8) JSC “DOM.RF”, 001P-03R (ISIN RU000A0ZZ1N0); maturity date: March 24, 2028, issue volume: RUB 15 bln — AAA(RU).
9) JSC “DOM.RF”, 001P-04R (ISIN RU000A0ZZ7C0); maturity date: May 10, 2028, issue volume: RUB 25 bln — AAA(RU).
10) JSC “DOM.RF”, 001P-05R (ISIN RU000A1004W6); maturity date: February 16, 2029, issue volume: RUB 10 bln — AAA(RU).
11) JSC “DOM.RF”, 001P-06R (ISIN RU000A100ET6); maturity date: May 12, 2039, issue volume: RUB 25 bln — AAA(RU).
12) JSC “DOM.RF”, 001P-07R (ISIN RU000A101590); maturity date: November 11, 2039, issue volume: RUB 20 bln — AAA(RU).
13) JSC “DOM.RF”, 001P-12R (ISIN RU000A1055Q0); maturity date: September 1, 2025, issue volume: RUB 30 bln — AAA(RU).
14) JSC “DOM.RF”, 002P-01 (ISIN RU000A105MN1); maturity date: September 22, 2027, issue volume: RUB 30 bln — AAA(RU).
15) JSC “DOM.RF”, 002P-02 (ISIN RU000A107GB4); maturity date: December 19, 2025, issue volume: RUB 10 bln — AAA(RU).
16) JSC “DOM.RF”, 002P-03 (ISIN RU000A107GC2); maturity date: December 17, 2027, issue volume: RUB 40 bln — AAA(RU).
Rationale. In ACRA’s opinion, the bonds listed above are senior unsecured debt instruments of DOM.RF. Due to the absence of either structural or contractual subordination of the issues, ACRA regards them as equal to other existing and future unsecured and unsubordinated debt obligations of DOM.RF in terms of priority. According to ACRA’s methodology, the credit ratings of the issues correspond to the credit rating of DOM.RF.
REGULATORY DISCLOSURE
The credit ratings have been assigned to JSC “DOM.RF” and the bond issues of JSC “DOM.RF” under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings with External Support and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities. The Methodology for Assigning Credit Ratings to Financial Instruments under the National Scale for the Russian Federation was also applied to assign credit ratings to the above issues.
The credit ratings of JSC “DOM.RF” and the bond issues of JSC “DOM.RF” (ISIN RU000A0JX2R1, RU000A0ZYF20, RU000A0ZYF38, RU000A0ZYFM5, RU000A0ZYFN3, RU000A0ZYLU6, RU000A0ZYQU5, RU000A0ZZ1N0, RU000A0ZZ7C0, RU000A1004W6, RU000A100ET6, RU000A101590, RU000A1055Q0, , RU000A105MN1, RU000A107GB4, and RU000A107GC2) were published by ACRA for the first time on December 29, 2016, January 18, 2017, October 31, 2017, October 31, 2017, November 9, 2017, November 9, 2017, December 25, 2017, February 1, 2018, April 5, 2018, May 17, 2018, February 28, 2019, June 5, 2019, December 24, 2019, September 5, 2022, December 19, 2022, December 22, 2023, and December 22, 2023, respectively. The credit rating of JSC “DOM.RF” and its outlook, as well as the credit ratings of the bond issues of JSC “DOM.RF”, are expected to be revised within one year following the publication date of this press release.
The credit ratings were assigned based on data provided by JSC “DOM.RF”, information from publicly available sources, and ACRA’s own databases. The rating analysis was performed using the IFRS financial statements of JSC “DOM.RF” and the management reports of JSC “DOM.RF”. The credit ratings of JSC “DOM.RF” and its bond issues (BO-05, BO -06, BO -07, BO -08, BO -10, 001Р-01R, 001Р-02R, 001Р-03R, 001Р-04R, 001Р-05R, 001Р-06R, 001P-07R, 001P-12R, 002P-01, 002P-02 and 002P-03) are solicited, and JSC “DOM.RF” participated in their assignment.
In assigning the credit ratings, ACRA used only information, the quality and reliability of which were, in ACRA’s opinion, appropriate and sufficient to apply the methodologies.
ACRA provided additional services to JSC “DOM.RF”. No conflicts of interest were discovered in the course of credit rating assignment.