Strong market position as the sole issuer of residential mortgage-backed securities (RMBS) in Mongolia. Steady profit stream. Inherent concentration risk in the mortgage market. Rising credit risks related to its commercial mortgage exposure. The stable outlook on Mongolian Mortgage Corp. HFC LLC (MIK) mainly reflects our view that the company's capitalization will steadily improve to an adequate level with a risk-adjusted capital (RAC) ratio of above 7% over the next 12-18 months, backed by solid recurring profit streams and modest asset growth. We also expect MIK to maintain its solid market position, and stable funding and liquidity profiles over the same period. At the same time, the outlook on MIK reflects the outlook on the sovereign credit rating on Mongolia.
