EBRD Trade Facilitation Programme supports Russia’s Transcapitalbank

By Richard Wallis

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The EBRD Trade Facilitation Programme (TFP) is increasing its support for Russia’s Transcapitalbank by increasing the bank’s trade facility by $30 million.

The agreement is part of the EBRD’s response to the global financial crisis under which the Bank has, inter alia, decided to further increase its facilities for some of the most active Issuing Banks under TFP.

Transcapitalbank has also received a 10-year subordinated loan of $15 million from the EBRD in late December to strengthen its balance sheet. Based in Moscow, the bank is focused on servicing small and medium-sized businesses, especially in the regions of Russia.

Rudolf Putz, head of the EBRD Trade Facilitation Programme, said: “In times of scarce trade finance limits the increased amount will help Transcapitalbank to meet the demand in trade finance and support local clients, especially small and medium enterprises particularly affected by the current financial crisis.”

Sergei Sisoshvili, Transcapitalbank’s Vice President International Business, added: “EBRD’s TFP is a very significant and supportive mechanism for medium-sized banks in emerging markets especially when a bank just started its trade finance activity, rising to the stream of positive track records with other banks strongly represented in the trade finance market. The programme is also very important under the present market conditions as commercial banks take a more cautious approach in providing new trade finance lines. The increased TFP limit will further help us with the development of our trade finance activities.”

Established in 1999, TFP supports trade to, from and within the EBRD’s countries of operations. The programme assists participating banks in building track records with their correspondent confirming banks, reducing cash collateral requirements and freeing up clients’ working capital by providing guarantees to confirming banks for the payment of various trade finance instruments issued by local banks.

Transcapitalbank joined TFP in 2004 and has since used facilities for financing foreign trade transactions worth over €100 million. The bank has already started to use part of the increased limit for the financing of imports of electric power tools and accessories to Russia.

Since the start of the programme in 1999, TFP has facilitated more than 7,800 trade deals worth over €4.8 billion, including 1,670 transactions in Russia worth €1.9 billion.

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