OREANDA-NEWS. August 23, 2007. the 8th International Aviation & Space Salon MAKS 2007 opened in Zhukovsky, Moscow region. For several years running, VTB Bank has been acting as a General Sponsor of the Salon Among participants and attendees of the Salon will be all leading enterprises of the Russian aviation and space industry, as well as aviation companies from the CIS and other countries.

VTB status as a General Sponsor of the Salon is underpinned by the Bank’s broad vision of the future prospects of aviation, aircraft building and space industries, and also by its aspiration to attain an advanced level of partnerships with enterprises of the defence and industry complex.

Presently, VTB has close relationship with almost all leading aviation enterprises and holdings, among which are Sukhoi Company (JSC), Irkut SPC, “MIG” Russian Aviation Corporation, Ulan-Ude Aviation Plant (JSC), Rostvertol PLC, “Salyut” Moscow Machine-Building Production Plant, “Saturn” Scientific and Production Association and many others. To facilitate financing of exports under Russia’s military and technical cooperation with foreign state, VTB closely cooperates with the Federal Service of Military and Technical Cooperation of Russia, Russian Defence Ministry, Rosoboronexport Federal Unitary Enterprise, and Federal Industry Agency.

As of today, there are documentary credit limits exceeding RUR 25 bln and opened to finance export supplies of aircrafts to Malaysia, Algeria, and India, as well as to finance SSJ project participants which are customers of the Bank and are also related to the United Aircraft Corporation. Aircraft enterprises have received loans for the amount exceeding USD 500 mln.

About USD 1 bln guarantees have been issued to defence and industry enterprises. 

Alongside standard banking products, VTB is also engaged in various structured deals. For example, together with its subsidiary, VTB-Leasing, VTB is an active participant in the project with the total value of tens of USD millions aimed at technical overhaul of such aircraft manufactures, as JSC KNAAPO and Irkut SPC.

Besides, the Bank participates in the development and construction program of SSJ, a Russian Regional Jet. An agreement signed between VTB Bank and Sukhoi Civil Aircraft company envisages raising finance for Sukhoi Civil Aircraft, either joint or syndicated, including resources of the Bank’s subsidiaries and affiliates; trade and project financing, and international market borrowing.

Also, VTB closely cooperates with the leading manufacturer of air defence missiles – Almaz-Antei Concern.

There recently was an upsurge of activities in the partnership between VTB and space enterprises, among which are the Federal Space Agency, Khrunichev State Research and Production Space Centre, NPO Mashinostroeniya Federal Scientific and Production Centre, Votkinsky Works, Krasnoyarsky Machine-Building Plant, and others. The Bank’s cooperation with the Federal Space Agency is developing under the previously signed Cooperation agreement which implies VTB participation in the Agency’s projects within the Federal Space Program and raising funds for building space vehicles and equipment, especially those with a long production cycle. The Agreement also provides for a comprehensive banking servicing of space industry enterprises, supporting their working capitals, raising finance for their investment projects and programs, and also servicing their foreign economic activities. The Bank also intends to co-finance programs aimed at modernization and construction of in-orbit satellites, space vehicles and carrier rockets, at upgrading production capacities of space enterprises, including leasing of manufacturing equipment.

One of top priorities in VTB activities is its cooperation with air transport enterprises. Total volume of the Bank’s credit risks under transactions with air transport companies has exceeded USD 400 mln over the last two years. Cooperation in this sphere includes financing operational and investment needs of the companies, including pre-export lending and import supply lending with foreign export credit insurance agencies being actively involved.
Airport facilities development is also in the core of VTB attention. Together with Aeroflot – Russian Airlines, VEB and Sheremetyevo International Airport, VTB is engaged in a large construction project “Terminal 3”. Of note is that the Bank is participating in the project not only as a lender or financial agent, but also as a shareholder.

VTB Bank is proud of its on-going cooperation with Russian air carriers. Among the Bank’s customers are the largest air companies of Russia, such as: Aeroflot – Russian Airlines, Sibir, KrasAir, Polyot, UTair, Volga-Dnepr Group, Aeroflot-Cargo, and Transaero. The total documentary credit facilities opened by the Bank for aviation companies have exceeded RUR 13 bln. Jointly with Donau Bank AG (Vienna) and Citibank, VTB arranged a USD 60 mln syndicated loan for Aeroflot – Russian Airlines company. The Bank also arranged UTair-Finance bond issue for RUR 1 bln. Air companies which are customers of VTB account for 47% of passenger and 62% cargo air flights.

In order to safeguard its customers’ interests, VTB gets involved its 100% subsidiary company VTB-Leasing which was founded in 1994. Today the Company has customers among both private and state enterprises from different sectors of economy and in various regions of Russia. VTB-Leasing has also established good partnership relations with a number of large foreign and domestic suppliers of equipment. The Company has proved most efficient in implementing large- and mid-size projects, where high profile management is needed to structure the deals and where the cost and term of borrowings are the most crucial factors.