On Using Oil and Gas Revenues of the Federal Budget

1 july 2009 года
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In June 2009, Russia’s Finance Ministry carried on implementing Russian Government Order dated March 10, 2009 N 271-r “On Using Funds of the Reserve Fund to Balance the Federal Budget”. Some funds of the Reserve Fund in foreign currency held in accounts with the Bank of Russia were converted into rubles to be later placed into the account to record funds of the federal budget. As a result of the said transactions, 2.53 billion US dollars, 1.81 billion euros, 0.34 billion pounds sterlings were sold for 175.59 billion rubles and the funds received were transferred to the account to record funds of the federal budget. Thus, funds of the Reserve Fund in the total amount of 1 435.59 billion rubles were used to balance the federal budget in the current year.

Under the Budget Code of the Russian Federation, oil and gas revenues of the federal budget for May 2009, in the amount of 175.76 billion rubles were transferred in June 2009 to the account to record funds of the federal budget. Under the Russian Government Resolution dated December 17, 2007, N 892 “On Making Settlements and Transferring Funds to Form and USE Oil and Gas revenues of the Federal Budget, Oil and gas Transfer, Funds of the Reserve Fund and the National Wealth Fund”, the abovementioned oil and gas revenues were transferred to the account to record funds received from oil and gas revenues of the federal budget and were later used to finance oil and gas transfer in full.

In connection with the shortage of oil and gas revenues for the reporting month  and in order to secure oil and gas transfer and subject to the said order of the Russian Government and the Finance ministry’s Order dated February 14, 2008 № 25n “On Approving the Procedure for Cooperating between the Russian Finance ministry and the Russian Federal Treasury upon Making settlements and Transferring in order to Form and Use Oil and Gas Revenues of the Federal Budget, Oil and Gas Transfer, Funds of the Reserve Fund and the National Wealth Fund” some funds of the Reserve Fund in foreign currency in the accounts of the Bank of Russia, namely, 0.51 billion US dollars, 0.37 billion euros and 0.07 billion pounds sterlings were sold for 35.17 billion rubles and the funds received were transferred to the account to record funds of the federal budget.

As of July 1, 2009, the aggregate amount of the Reserve Fund was 2 957.54 billion rubles, which is equivalent to 94.52 billion US dollars. As of July 1, 2009, amounts of balances in separate accounts to record funds of the Reserve Fund were:

  • 41.78 billion US dollars
  • 29.22 billion euros;
  • 6.36 pounds sterlings.

In June 2009, Russia’s reserve position in the IMF formed through the Reserve Fund’ financial resources increased by 101.67 SDRs and as of July 1, 2009 amounted to 858.54 million SDRs.

 The aggregate calculated income from placing funds of the Reserve Fund recalculated in dollars  for a period from January 15, 2009, to June 30, 2009, was 0.87 billion US dollars, which is equivalent to 27.07 billion rubles. Calculated interest income from placing funds of the Reserve Fund in foreign currency was (in currency of account and ruble equivalent): 0.06 billion US dollars (1.82 billion rubles); 0.51 billion euros (22.44 billion rubles); 0.05 billion pounds sterlings (2.81 billion rubles). The exchange rate difference from recalculating balances of funds in accounts to record funds of the Reserve Fund in foreign currency for a period from January 15, 2009 to June 30, 2009 was a positive value of 137.83 billion rubles.

In accordance with resolution of the Russian Government dated January 19, 2008 № 18 “On the Procedure of Managing ,Funds of the National Wealth Fund” as of July 1, 2009, 432.10 billion rubles were transferred from the account to record funds of the National Wealth Fund to be deposited with Vnesheconombank and out of this amount:

  • 257.10 billion rubles to be deposited for a period up to December 31, 2019, with an interest rate of 7% per annum;
  • 175.00 billion rubles to be deposited for a period up to October 21, 2013, with an interest rate of 7% per annum.

As of July 1, 2009, the aggregate amount of the National Wealth Fund was 2813.94 billion rubles, which is equivalent to 89.93 billion US dollars. As of July 1, 2009, amounts of balances were:

1)     In separate accounts to record funds of the National Wealth Fund with the Bank of Russia:

  • 34.44 billion US dollars;
  • 24.50 billion euros;
  • 4.46 billion pounds sterlings;

2)     on deposits with Vnesheconombank:

  • 432.10 billion rubles.

The aggregate calculated income from placing funds of the National Wealth Fund recalculated in dollars for a period for a period from January 15, 2009, up to June 30, 2009, was 0.52 billion US dollars, which is equivalent to 16.30 billion rubles. Calculated interest from placing funds of the National Wealth Fund in foreign currency was (in currency of account and ruble equivalent): 0.04 billion US dollars (1.31 billion rubles); 0.31 billion euros (13.80 billion rubles); 0.02 billion pounds sterlings (1.19 billion rubles). The exchange rate difference from recalculating balances of funds in accounts to record funds of the National Wealth Fund in foreign currency for a period from January 15, 2009 up to June 30, 2009, was a positive value of 56.05 billion rubles.

All conversion transactions with funds of the Reserve Fund and the National Wealth Fund were conducted in conformity with the currency structure approved earlier at official rates of foreign currencies set by the Bank of Russia as of the date of transactions and did not have any impact on the conditions of the foreign exchange market.

Indicators of aggregate amounts of the Reserve Fund and the National Wealth Fund as well as of calculated incomes from placing funds of the Reserve Fund and the National Wealth Fund were calculated on the basis of official exchange rates of foreign currencies set by the Bank of Russia as of the date prior to the reporting date and of cross rates calculated on the basis of the said exchange rates.

Detailed statistics on transactions with funds of the Reserve Fund and the National Wealth Fund is posted on the Internet site of the Russian Finance Ministry in the following sections: “The Reserve Fund” and “The National Wealth Fund” in appropriate subsections in Russian and English, the statistics is updated on a regular basis.

 

Origin: Press Service of Russia’s Finance Ministry

 

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On Increasing Charter Capital

29 june 2009 года
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In accordance with the Regulation of the Russian Government, the Russian Finance Ministry transferred funds worth 100 billion rubles to the charter capital of State Corporation ‘Bank for Development and Foreign Economic Affairs (Vnesheconombank)’.

At present, Vnesheconombank’s charter capital is about 362.5 billion rubles.

 

Origin: Press Office of Vnesheconombank
Contact person: Ekaterina Karasina
Phone: +7 (495) 608-46-93, Fax: +7 (499) 975-21-34
E-mail: press@veb.ru

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VEB to Increase Support for Small Enterprises by 10 Billion Rubles to 40 billion Rubles

26 june 2009 года
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Moscow. June 25. INTERFAX-AFI – Vnesheconombank is to increase support for small and medium-sized enterprises by 10 billion rubles to 40 billion rubles rather than 30 billion rubles as it was planned before, Mikhail Kopeikin, Management Board Member, VEB Deputy Chairman, Board Director of the Russian Development Bank told Interfax-AFI.

“In the near future, Vnesheconombank’s charter capital is to be increased by 100 billion rubles. Out of them 10 billion rubles will be committed to the Russian Development Bank’s charter capital”, he said adding that besides these funds another 30 billion rubles of budgetary funds will be committed to the program of supporting small and medium-sized enterprises.

 The state was planned earlier to earmark 30 billion rubles for supporting small and medium-sized enterprises – 20 billion rubles for lending itself and 10 billion rubles to be committed to the Russian Development Bank’s charter capital.

“Thus, we expect the total amount of funds to be committed for supporting small enterprises through VEB and its subsidiary banks to be about 40 billion rubles”, said M. Kopeikin.

He said that at present a Regulation of the Government is being prepared subject to which 30 billion rubles would be deposited with Vnesheconombank up to December 2017 at a rate of 8.5% per annum. And upon transferring them to the Russian Development Bank, VEB is not going to charge any margin.

According to the plans, partner banks that are in the long run responsible for financing small and medium-sized enterprises are to receive funds from the Russian Development Bank at a rate of 10.5% per annum which is lower that the refinancing rate.

Mr. Kopeikin said that a proposal to participate in the program of supporting small and medium-sized enterprises had been sent to 248 banks. Within a week after announcing the start of accepting their applications about 40 banks submitted applications.

He said that it was an absolutely new program. It is based on the mechanism for financing portfolios of credits to be extended to small enterprises which are now being formed by regional partner banks of the Russian Development Bank. Banks will be able to refinance loan portfolios intended for small enterprises at the Russian Development Bank within regional limits (from 100 to 800 million rubles).

Now VEB together with the Russian Development Bank, the Russian Central Bank and in cooperation with Deloitte & Touche CIS consultants are exploring the possibility of raising the Bank of Russia’s funds to increase the amount of financing to support small and medium-sized enterprises.

“ We can produce a significant multiplier effect of more than 2”, said M. Kopeikin adding that only through using the funds to be committed we can increase the amount of the state’s support to more than 80 billion rubles.

“Given that VEB’s subsidiary banks have loan portfolios worth about 25 billion rubles for small and medium-sized enterprises, the amount of the state’s support might exceed 100 billion rubles in 2009”, he added.

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On Signing a Memorandum between Vnesheconombank OJSC Bank VTB, Roseximbank, Angola’s Finance Ministry and Angola’s Telecommunications and Information Technologies Ministry

26 june 2009 года
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In the course of Russian President Dmitry Medvedev’s formal visit to the Republic of Angola, State Corporation ‘Bank for Development and Foreign Economic Affairs (Vnesheconombank)’, OJSC Bank VTB (VTB), Roseximbank, Angola’s Finance Ministry and Angola’s Telecommunications and Information Technologies Ministry signed a Memorandum of Understanding.

Russian banks are planning to further promote cooperation in supporting Russian industrial exports. The Memorandum provides for raising funds of Vnesheconombank, VTB and Roseximbank to finance a project aimed at building a space satellite communications and broadcasting system on the territory of the Republic of Angola.

According to the Memorandum on Vnesheconombank’s Financial Policies providing support for industrial exports and services is one of the main lines of Vnesheconombank’s investment activity.

The signing and further implementation of the Memorandum would help boost economic ties between the Russian Federation and the Republic of Angola.

 

Origin: Press Office of Vnesheconombank
Contact person: Ekaterina Karasina
Phone: +7 (495) 608-46-93, Fax: +7 (499) 975-21-34
E-mail: press@veb.ru

 

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On Closing a Deal between Vnesheconombank and Group LSR

25 june 2009 года
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State Corporation ‘Bank for Development and Foreign Economic Affairs (Vnesheconombank)’ and Group LSR signed a package of credit documentation to finance a project to build a cement factory in the city of Slantsy of the Leningrad region.

On behalf of Vnesheconombank the documentation was signed by Management Board Member - Vnesheconombank Deputy Chairman Anatoly Ballo, on behalf of Group LSR – by its General Director Igor Levit.

In order to finance the said project Vnesheconombank is to open credit lines for a total amount of 237 million euros for a period of 10 years.

The project is designed for launching a full-cycle cement production facility with a capacity of 1.86 million tons of finished product per year. Unique technological equipment is to be used for manufacturing cement. This equipment makes it possible to significantly reduce resources and power consumption.

Once a cement factory has been launched more than 400 jobs will be created and budgets of all levels are expected to receive about 2 billion rubles per year.

OJSC Group LSR is the largest developer and construction materials manufacturer in the North-West Federal District.

 

Origin: Press Office of Vnesheconombank
Contact person: Ekaterina Karasina
Phone: +7 (495) 608-45-93, Fax: +7 (499) 975-21-34
E-mail: press@veb.ru

 

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