Russian Prime Minister V.V Putin Conducts a Meeting of State Corporation ‘Bank for Development and Foreign Economic Affairs (Vnesheconombank)’ Supervisory Board
V.V Putin’s Opening Address
Good evening Esteemed Colleagues!
We’ve got several important issues on our agenda today. First of all, I would like to dwell on the Bank’s annual performance report for 2008.
This was a difficult period for the Russian credit-financial system and for the economy as a whole. Starting from August, we had to withstand the onslaught of the financial crisis and adapt to operating in the new rather severe conditions.
I would like to note that VEB’s team demonstrated a required level of professionalism and the Bank itself operated in a very sustainable and efficient way performing its core activities and acting in the capacity of the Government’s crisis management instrument.
The materials submitted show that despite the crisis, the Bank’s loan portfolio was in excess of 350 billion rubles last year.
The Bank started to finance 21 new projects. They are aimed at developing infrastructure, high-technology sectors, creating new industrial production facilities. They include modernization of railway arteries in Siberia and the Far East; industrial parks were created in Tatarstan and the Kaluga region, high priority was given to the reconstruction of several power generating stations, work was also in progress in the power engineering industry. The Bank started to participate in financing the construction of Olympic facilities in the city of Sochi.
It goes without saying that the Bank will carry on considering applications for new investment projects.
At this meeting we are planning to discuss one of them, this project is aimed at creating engines of new generation at Avtodizel factory.
I’d like to remind you that a principal decision on VEB’s participation in this project was made last December in the course of the working trip to the Yaroslavl region. Here I mean power plants for domestic trucks meeting strict requirements for reliability and ecological standards.
At present, trials of engine prototypes are at their final stage. The Bank’s financing would make it possible to launch their batch production and create more than one thousand and two hundred jobs.
I’d like to mention the Bank’s interesting and promising initiative designed to use foreign investment funds for implementing infrastructure projects.
And in the end we must discuss Vnesheconombank’s efforts to implement the Government’s crisis management measures. In particular, we’ll discuss how the companies that obtained VEB’s credits at the end of 2009 to refinance their loans at foreign financial institutions fulfill their obligations.
The funds made available by VEB made it possible to avoid stripping of Russian companies’ strategic assets pledged abroad. Initially we planned to spend 50 billion dollars for these purposes but actually we had to spend only 10.5 billion dollars, with a part of this sum having been already repaid.
I’d like to say it once more that assistance with refinancing debts is not a gift given by the state to major companies but credits that are to be repaid and serviced properly.
Now let’s move on to our agenda.
At a regular meeting of Vnesheconombank’s Supervisory Board a decision was taken to add the procedure for Vnesheconombank’s implementation of measures provided for by clauses 4 and 6 of Federal Law dated October 13, 2008 № 173-FZ “On Additional Measures for Supporting the Financial System of the Russian Federation” with a requirement for a minimum amount of equity of no less than 3.5 billion rubles for banks to be able to obtain subordinated loans.
Moreover, requirements to borrower banks for lending to the real economy were made more stringent, now they are to secure for a period of one year from the date of obtaining a subordinated loan availability of credits in their loan portfolio to be extended to high-priority economic sectors in line with recommendations of the Russian Economic Development Ministry, with repayment periods of no less than one year at an effective rate not exceeding the Bank of Russia’s refinancing rate increased by three percentage points in the amount no less than the sum of obtained subordinated loan and they are also to maintain the volume of such credits until they repay a subordinated loan.
Vnesheconombank’s Management Board was ordered to hold talks with borrowers over their agreement with the said terms of obtaining subordinated loans.
Vnesheconombank’s Supervisory Board made a decision to extend subordinated loans to the following Russian lending institutions: CJSC JSCB NOVIKOMBANK in the amount of 478 719 000-00 rubles, OJSC JSCB ROSEVROBANK in the amount of 980 000 000-00 rubles, OJSC TransKreditBank in the amount of 2 930 000 000-00 rubles, OJSC Bank Saint-Petersburg in the amount of 1 466 000 000-00 rubles JSCB Transkapitalbank (CJSC) in the amount of 729 998 500-00 rubles, OJSC Pervobank in the amount of 725 000 000-00, OJSC SKB-bank in the amount of 810 000 000-00 rubles, OJSC Promsvyazbank in the amount of 4.000.000.000-00, OJSC Bank ZENIT in the amount of 2 140 000 000-00 rubles, CJSC Bank Russky Standard in the amount of 4 958 783 400-00.
The Supervisory Board also approved a decision on extending by Vnesheconombank a credit line with a limit of up to 10 billion rubles for a period of up to 15 years to the winner of the tender held by the Administration of Saint-Petersburg for the right to conclude an agreement on building, reconstructing and operating facilities incorporated in the assets of the Pulkovo airport on the basis of public private partnership.
The Supervisory Board also approved Vnesheconombank’s participation in financing the project to build a propylene manufacturing complex with a capacity of 500 thousand tons a year at Tobolsk-Polymer (LLC) (the Tyumen region) by way of opening credit lines for Tobolsk Polymer (LLC) for a period of up to 13.5 years.
Origin: Press Office of Vnesheconombank
Contact person: Ekaterina Karasina
Phone: +7 (495) 608-46-93, Fax: +7 (499) 975-21-34