OREANDA-NEWS  On 04 March was announced, that the Open Joint Stock Company "Raiffeisen Bank Aval", which is 96-per cent owned by Raiffeisen International Bank-Holding AG, is to receive a USD 160 mln subordinated loan facility with a 10-year tenor from Raiffeisen Zentralbank Osterreich AG (RZB). RZB, which in turn owns more than two-thirds of Raiffeisen International, strengthens the Tier 2 capital*) of Raiffeisen Bank Aval by extending this facility, which is accountable as supplementary capital.

Subordinated loan facility of USD 160 mln with a 10-year tenor

Facility strengthens Raiffeisen Bank Aval’s Tier 2 capital

On the basis of so-called stress tests (in which various market development scenarios where modeled), the National Bank of Ukraine (NBU) determined a need for additional capital at the 17 largest commercial banks in Ukraine and issued a decree that the appropriate increases be implemented by 1 May 2009.

"The capitalization of Raiffeisen Bank Aval as compared to other banks in Ukraine is relatively good", said Volodymyr Lavrenchuk, CEO of Raiffeisen Bank Aval. "Obtaining this facility will improve our capitalization, enabling stable and secure operations of our bank in the future", he added.

"This transaction is further proof of our commitment to and support of our network banks in Central and Eastern Europe", said Herbert Stepic, Deputy Chairman of RZB and CEO of Raiffeisen International. "Moreover, it may serve as a sign of our confidence, that notwithstanding the current difficulties, the Ukrainian economy and, with it, the Ukrainian financial system will weather this storm."