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In September 2006, Aurora Russia announced that it would invest £12.5 million to launch Kreditmart , a mortgage and consumer finance brokerage. Aurora Russia owns 100% of Kreditmart, 15% of the shares have been reserved for an employee stock option plan. In September 2007, Aurora Russia announced they would invest a further £10 million into Kreditmart, to support company growth.
Building a leading brand
Kreditmart commenced operations in March 2007 with the launch of its first loan shop in Moscow. The company now offers over 400 consumer finance products including mortgages, equity release loans and insurance, through a network of loan shops, the internet and distribution agreements with banks.
The company has opened a further nine shops; two more in Moscow and one in each of the key cities of St. Petersburg, Omsk, Novosibirsk, Yekaterinburg, Kazan, Tyumen, and Rostov-on-Don. In addition, the company has launched seven high street sales points in the Moscow Region in real estate sales offices. Kreditmart now distributes products from approximately 50 banks and the company has grown to employ a staff of 170 people.
In 2007, Kreditmart originated $32 million in mortgages, this total grew to approximately US$50 million to March 2008. Kreditmart has a significant pipeline of mortgages and is quickly becoming a leading brand name in Russia. Sekretni Firm, one of Russia’s leading financial magazines, has already referred to the company as Russia’s leading mortgage broker and voted it as one of the top new companies of 2007.
A high-growth sector
Despite liquidity tightening worldwide, the Russian mortgage market continues to grow very quickly. According to the Central Bank of Russia figures rose from from US$10 billion at the end of 2006 to US$25 billion at the end of 2007. Kreditmart is in an excellent position to benefit from this growth.
In April 2008, Aurora Russia announced that their wholly owned subsidiary Flexinvest Limited was to purchase Volzhski Univeralnsy Bank a small bank with a full retail banking licence and part of the Russian deposit insurance system. On completion of the purchase, it is intended that the bank will enter into an agent bank agreement with Kreditmart to enable it to book mortgages faster and hold these mortgages for on-sale to partner banks thereby providing a competitive advantage.
Valuation details can be viewed in Aurora Russia Limited’s Results which are posted in the Press Room.
Visit the website of Kreditmart loan products: www.kreditmart.ru
Return to Aurora’s Russian investment fund portfolio
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