Vladimir Putin's Opening Address
Good afternoon esteemed colleagues. Today we are holding a final meeting of Vnesheconombank’s Supervisory Board in the outgoing year, and I would like first of all to thank the Bank's management and all its employees for their intensive and hard work in the outgoing year.. A great deal has been accomplished almost without fail. The scale of the work is impressive. I very much hope that the Bank will go on operating in a highly professional way..
We face major challenges of modernizing our economy and making it more competitive and innovative. There are many challenges involved in developing territories. Vnesheconombank is actively working in practically all these areas.
I must say that VEB's loan portfolio has increased by almost 40% in the first eleven months of this year as a development institution - not just as a rank and file financial institution.
Moreover, Vnesheconombank is acquiring and has already practically acquired new instruments for achieving the tasks assigned to it. I mean above all the fact that the management company of the Russian Direct Investment Fund has started operating. It has been created quite recently, but the management company has projects worth 180 billion rubles in its loan portfolio. This is no mean achievement.
Esteemed colleagues, despite well-known difficulties and troubling developments in the world economy, and they are indeed alarming, some complicated processes are also taking place in advanced market economies and some countries are already in recession, that is, their economies have experienced a contraction in GDP for three consecutive months, and there are gloomy forecasts for some euro-zone countries and the States (things have improved a bit there, but on the whole the problems persist) I would like to note that the Direct Investment Fund we have set up may be very much needed because there are not many promising and reliable projects in the world, but we have some. Global investment funds have considerable resources: they are looking for places to spend these resources. As you know, most recently I’ve been at the launch of the Kyzyl-Kuragino railway. Here we have an example of such a project: huge deposits, top quality coal and an absolutely reliable sales market. There are not many such projects in the world, and it is not the only one in Russia. So, I would like you to actively launch such projects and to work more energetically with our partners in the Investment Fund. Step up your efforts! I am sure that we won’t even have to use our reserves and budget resources. Why should we if those who have the money are looking for projects to invest in and we have them? All we need is to work more actively in this direction.
The North Caucasus Development Corporation, set up under your Bank's auspices, has started operating. The Russian Export Credit and Investment Insurance Agency also faces major tasks. We expect the Agency to take energetic steps to support our enterprises, above all of course, those in high-tech sectors. That is what it was created for. Oil and gas workers and metallurgists have their niches in world markets. We need to support high-tech exports.
I would like to stress once again that the tasks aimed at creating points of growth and supporting innovations are linked to supporting exports. I expect VEB’s team to go on working efficiently and consistently.
Now I’d like to say a few words about the current agenda. I see here some interesting projects that stand out not only in terms of their scale, but are in my opinion potentially very useful for improving our economy. The first of these is the project to develop the potassium and manganese salt deposits and to build a mining and concentration plant in the Perm Territory. Why did it catch my attention? Not only because VEB is committed to investing heavily in it (more than 40 billion rubles), but because it is a step that should eventually lead to demonopolization of that sector of our economy. Demonopolization is very important. This is not to say that we should eliminate someone, on the contrary, when a competitive environment is created, the situation improves and prices for a needed and important agricultural product are stabilize, the export potential increases, and in this case VEB does not only enter the capital worth 6.7 billion rubles, but also extends a 33 billion ruble credit. That is a huge amount. The capacity of the mining and concentration plant will be about 2 million tones of potassium chloride, of which 600,000 tonnes should be sold on the domestic market. I am sure it will give an extra boost to our agro-industrial complex.
Second, a 25 billion-ruble credit line is to be opened for the construction of the middle segment of the Western High-Speed Diameter motorway in St Petersburg. It is a very important project for the northwest of our country, not only for the city of five million but for the entire northwest. There’s no doubt, it will mark a step forward in developing our infrastructure and in giving a second wind to this part of our country, giving it a new character that is in line with European standards, and it will free this city of five million people from an excessive number of heavy vehicles, many of which still pass through central parts of the city even after the ring road around Petersburg was built. The Western High-Speed Diameter is very important for the city.
I was in Petersburg on December 23 attending the ceremony of signing relevant documents. I would like to thank all those who worked actively in order to draw one more line and create necessary conditions for the work to start.
Finally, a 2.5 billion-ruble credit is to be extended for the "Film Club: Culture, Education, Communications" project involving the creation of a cluster of such clubs within the KinoCity project. At least 250 multimedia cinemas are to be built, above all in small and medium-sized towns. This kind of social infrastructure is in short supply in our small and medium-sized towns, and we should do our best to launch it. We have discussed it more than once. I know some agencies have their own ideas on that score, but I would like to stress that we must support this kind of projects. Such clubs are unevenly distributed throughout our country and they need to be supported. The situation is more or less normal in cities with a population of over a million, while in small and medium-sized cities the number of such clubs is diminishing. They must be supported.
Let's start our work.
Origin: Internet-Portal of the Government of the Russian Federation
V.V Putin’s Opening Address:
Good evening esteemed colleagues,
Today we are to discuss Vnesheconombank’s mid-term strategy up to the year 2016. I’d like to note that the Bank’s business experience as a development institution was taken into account when the strategy was worked out. It is this line of the Bank’s activity that should be enhanced in the coming years. VEB must play a more active role in the investment policy, act as a powerful financial driving force of projects that are designed to change the structure of the Russian economy, make it more sustainable against any external shocks. Top priority should be certainly given to supporting high-technology and infrastructure programs, projects that create new quality jobs.
I’d like to stress that even now VEB is highly instrumental in modernizing the Russian economy. For example, the Bank’s loan portfolio as a bank for development increased from early 2009 by more than 80%. And above all this increase was achieved by funding key industrial enterprises, the high-technology sector, transport as well as the most important construction projects and facilities in electronics, infrastructure and transport mechanical engineering.
I’d like to list objectives VEB will have to address in the coming four years. First, VEB is supposed to invest about 2 trillion rubles in the Russian economy till the end of 2015. These are significant resources – about 2.4% of GDP. The Bank for Development will have to more than double its loan portfolio and the proportion of high-technology and innovations projects should increase from 15 to 20% in the total financing amount.
The Bank’s cooperation with the Agency for Strategic Initiatives will become an important line of its innovative activity. Here, VEB can act as a consultant, provide qualified expert support in selecting projects to be offered by this Agency.
Second, the Bank should increase by many times its support for high-technology exports. We should realize the Bank’s full potential to help our companies to tap into the most advanced, promising markets. By 2016, the amount of support for our exporters, their innovative technological products should be about 90 billion rubles.
In this respect, today we have to approve the Charter of the Russian Export Credit and Investment Insurance Agency and form its governance bodies. The Agency’s charter capital is 30 billion rubles. This new institution will take some of financial risks, help our exporters to tap into international markets and promote high-technology products and services. We expect the Agency to operate effectively. I hope that as early as this year Russian exporters will be able to get their first contract insured with its assistance.
The third and very important line of activity. I’d like to stress that Vnesheconombank’s strategic priority will be to advance programs aimed at providing support for small and medium-sized enterprises. And at the same time top priority will be given to supporting companies operating in the non-trade sector of the economy, to funding innovation projects associated with creating new production facilities, quality products and technologies. And there is no doubt that the Bank will go on participating in housing programs. VEB has already earmarked up to 250 billion rubles to develop mortgage lending including refinancing of housing credits.
VEB’s Supervisory Board Approves the Bank’s Development Strategy till 2016
Moscow, September 27 – PRIME. VEB’s Supervisory Board approved the development strategy of the Bank for 2011-2015. The strategy will make it possible to make full use of VEB’s instruments as a Bank for Development, VEB Chairman Vladimir Dmitriev told journalists.
“Specifically, the Bank’s loan portfolio is scheduled to amount to 850 billion rubles. VEB Leasing is to conduct leasing transactions for the amount of 150 billion rubles. VEB’s contribution to the development of the Russian economy would amount to more than 2% of GDP”, he said.
According to him the strategy also provides for supporting Russian industrial exports in the amount of about 90 billion rubles till 2016.
“We have approved parameters for conducting transactions on stock markets”, he said.
Dmitriev said that the previous strategy is deemed to have been completed. “Our current strategy aims to fulfill VEB’s potential as a bank for development”, he said adding that in the previous years VEB has failed to achieve this objective in full as it had to carry out crisis management measures in the economy, RIA Novosti reported.
Petr Frakov Appointed as Head of Export Credit and Investment Insurance Agency
Moscow. September 27. INTERFAX- Vnesheconombank’s Supervisory Board approved a charter of the Export Credit and Investment Insurance Agency.
Petr Fradkov was appointed as the Agency’s Director, Vnesheconombank Chairman Vladimir Dmitriev said.
Investments in supporting Russia’s industrial exports are to amount up to 90 billion rubles. Petr Fradkov is appointed as the Agency’s Director, VEB Chairman Vladimir Dmitriev told journalists after the Supervisory Board’s meeting on Tuesday.
VEB Approves Funding of Rusal’s Taishet Plant
MOSCOW, September 27 (Reuter) – VEB’s Supervisory Board approved financing of Rusal’s project on the construction of the Taishet Aluminum Plant in the amount of 40 billion rubles for a period of 15 years, Vnesheconombank Chairman Vladimir Dmitriev told journalists.
“All basic parameters have been approved. The funding amount is about 40 billion rubles. The project is to be funded in foreign currency – either in dollars or in euros”, he said after VEB’s Supervisory Board meeting.
VEB is now holding talks on funding the project in full through a credit line of a foreign partner bank.
VEB’s Supervisory Board agreed in principle to fund the project as early as at the beginning of August.
The construction of the Taishet plant started in 2007. During the crisis the project was frozen due to the absence of funds. The construction was renewed and it is now being funded through using Rusal’s own funds.
Depending of the Taishet project’s completion Rusal plans to increase aluminum production to 4.8-4.9 million tons per year against 4.08 million tons in 2010.
VEB’s Supervisory Board Approves Commitment of 39 billion Rubles to Build Sollers-Ford JV
MOSCOW, September 28 – RIA Novosti. Vnesheconombank’s Supervisory Board finally approved extending a 10-year credit worth 39 billion rubles for creating a Sollers-Ford Joint Venture, Vnesheconombank Chairman Vladimir Dmitriev told journalists.
“The project’s final version has been presented today with all terms and conditions and with a trilateral agreement (VEB, Ford, and Sollers) with regard to minimizing risks that might emerge upon occurrence of a whole number of circumstances including force major circumstances”, Mr. Dmitriev said.
He said that in the near future the project would be launched.
According to him the credit’s 36 billion rubles will be used for making investments and 3 billion rubles will comprise current assets.
In mid September, at the 10th Investment Forum in Sochi State Corporation Vnesheconombank and OJSC Sollers signed a credit agreement on creating a Sollers-Ford Joint Venture to manufacture commercial cars and all-roaders with a capacity of up to 350 thousand automobiles per year.
In June of 2011, Russian Automobile Company Sollers and American Auto Concern Ford signed an agreement with Vnesheconombank on extending a credit to fund the creation of a joint venture to manufacture automobiles in Russia.
VEB Intends to Use 10% of its Profit to Capitalize SME Bank
MOSCOW, September 28 – RIA Novosti. Vnesheconombank intends to use 10% of its profit annually to capitalize its subsidiary OJSC SME Bank, earlier the Russian Development Bank, Vnesheconombank Chairman Vladimir Dmitriev told journalists on Tuesday.
He said that originally they planned to use 10 billion rubles from the federal budget annually to capitalize this bank. “But there are budget constraints that make it impossible to increase the bank’s capitalization through using budgetary funds”, said Mr. Dmitriev.
Nevertheless, he said that it was necessary to additionally capitalize SME Bank to bring the amount of funds intended for supporting small and medium-sized business to 150 billion rubles by late 2015.
Mr. Dmitriev didn’t rule out that in case of improved world financial conditions and Russia’s improved budget it would be possible to raise a question of supporting the bank through using budgetary funds in the amounts planned earlier (10 billion rubles per year).
VEB’s Supervisory Board Approves Ernst & Young as Auditor of the Bank’s Financial Statements for 2011
MOSCOW, September 27 – PRIME. Vnesheconombank’s Supervisory Board approved Britain’s Auditing Company Ernst & Young as auditor of the State Corporation’s financial statements for 2011, Vnesheconombank Chairman Vladimir Dmitriev told journalists on Tuesday.
“We approved Ernst & Young as VEB’s auditor” said Mr. Dmitriev after the Supervisory Board meeting.
A tender for conducting a mandatory annual audit of the State Corporation’s financial statements for 2011 was announced on July 19, the envelopes with bids were opened on August 24. Russian subsidiary of Britain’s company – LLC Ernst and Young was declared the winner of the tender.
The following three auditing companies were allowed to participate in the tender: CJSC BDO with a bid price of 4.928 million rubles minus VAT, CJSC KPMG (a bid price of 8 million rubles minus VAT) and LLC Ernst and Young (a bid price of 1.1 million rubles minus VAT, RIA Novosti reported.