OREANDA-NEWS. December 14, 2009. LLS “BTA Bank” (Moscow) initiated convening of a meeting of holders of notes of Slavinvest Finance S.A. to obtain approval of extension of the date of their complete repayment. If BTA Bank (Moscow)’s proposal is approved, the maturity of the notes will be extended from December 21, 2009 till December 21, 2011, and the bullet repayment of the principal amount will be transformed into amortizing payment profile, reported the press-centre of BTA Bank.

The extension arrangements made available by the Bank suggest payment of nonrecurrent premium to the noteholders above the planned payments of the principal amount and the accrued coupon, made in respect to service of debt for the entire extension period, transformation of half-year payments of the accrued coupon into quarterly ones, as well as repayment of 10% of the principal amount immediately after approval of extension. At the same time the extension arrangements, as distinguished from the practice frequently used by issuers recently, suggest no writing-off of debts.

Over the period of operation in external markets the Bank proved to be a reliable partner, that is why the proposed extension arrangements are intended to meet interests of the noteholders at maximum under the existing conditions. The Bank’s willingness to arrange for the most comfortable terms and conditions is caused by the Bank’s intention to continue its operation in the international borrowings market as this kind of activity is one of the priorities of the Bank’s business development.

Over 2009 the Bank made considerable efforts in respect to early repurchase of notes, which resulted in decrease in the volume of  notes outstanding in the market from USD 100 mln till 70 mln. The Bank plans to keep decreasing the volume of notes in the market: the proposal of BTA Bank (Moscow) to the holders suggests repayment of 10% of the principal amount immediately after the extension approval, 45% -  in equal installments of 22.5% in June and December, 2010 and the remainder of 45% - in equal installments of 22.5% in June and December 2011 respectively.

Thus, the Bank confirms its commitment to its policy in the external borrowings market, whose basic principle is performing its obligations in full.

- In the time of unstable economy and banking segment securities market participants review their attitude to using the existing financial instruments – says Dmitry Kizenkov, Deputy Chairman of the Board of LLS “BTA Bank” (Moscow) – As to the transaction mentioned, we have a reason to believe that the proposal of LLS “BTA Bank” will be supported by the noteholders, as the terms and conditions published by the Bank suggest, firstly, continues service of the debt under the terms and conditions, which are more comfortable for the noteholders within the extension period, secondly, nonrecurrent compensations to the noteholders, and, which is most important, absence of any debt discounting.

As of today, the Bank fully performs its internal obligations as well, among others, to the Bank of Russia. The level of support and trust of the regulator to the Bank is evidenced by the fact that the agreement of extension of unsecured loans of the Bank of Russia in the amount of RUB 11.8 bln has been recently signed.
 
In case of approval of its proposal by the noteholders, the Bank will have an opportunity to strengthen those positive trends taking place recently in its business and direct the funds released for development of sales of active bank products in the internal market.