OREANDA-NEWS. On April 02, 2007 the European Bank for Reconstruction and Development and the International Finance Corporation, the private financing arm of the World Bank, have signed agreements to jointly acquire a stake of 25 percent plus one vote in the Vladivostok-registered Primsotsbank, the third largest regional bank in the Russian Far East, reported the press-centre of  EBRD. The investment, the latest by the EBRD in a string of regional banks spread across the whole of Russia, is aimed at strengthening Primsotsbank’s capital base, help it expand its operations and enhance its competitive position. The presence of the EBRD and IFC in the capital of Primsotsbank will contribute to increasing its transparency and strengthening its organisational structure, policies and procedures, said Kurt Geiger, EBRD Business Group Director for Financial Institutions.
Primsotsbank, set up in 1993 and privatised eight years later, pioneered the introduction of mortgage lending in the Russian Far East and today accounts for 70% of loans on the local mortgage market.


Fast-developing and innovative, Primsotsbank borrowed 90 million roubles from the EBRD in 2005 for on-lending to small and medium-sized businesses. Its long-term strategy is to grow into a universal bank providing a wide range of services to local corporates and retail customers. Other financial details of the transaction were not disclosed. In Russia, the EBRD also holds equity stakes in the following banks: Bank Center-Invest, Bank Kedr, Hansa Bank, International Moscow Bank IMB, Investment Bank of Kuban, KMB Bank, NBD, Transcapitalbank, Uraltransbank and URSA Bank. A number of other bank equity transactions have been approved by the EBRD Board, but not yet completed.