OREANDA-NEWS. February 09, 2010. Vladimir Dmitriev told the President about the measures for supporting small and medium-sized enterprises and the progress of implementing the Bank’s crisis-management programs.

An issue of reducing interest rates on credits with the use of Vnesheconombank’s financial resources is under discussion now.

D.Medvedev: Vladimir Alexandrovich, during our last meeting we discussed a whole range of measures for supporting small and medium-sized enterprises with due regard to the Bank’s current capabilities.

What have been done thus far in this respect? What programs are being implemented? How many small and medium-sized enterprises have been supported financially in terms of providing them with appropriate financial instruments? This is my first question.

And my second question is: what are you doing in your Bank in terms of addressing issues of anti-crisis management and strictly speaking those crisis management measures you are taking.

V. Dmitriev: Thank you for your questions Dmitry Anatoljevich.

As far as small and medium-sized enterprises are concerned, we launched a program of supporting small and medium-sized enterprises through Vnesheconombank’s subsidiary banks last year. 30 billion rubles were earmarked for supporting small and medium-sized enterprises.

Basically, the program was launched in last August when all the documents and procedures were agreed upon with regional banks and small and medium-sized businesses. By last year’s end, almost all financial resources were made available, that is, 25 billion rubles were made available to regional banks through the Russian Development Bank as of January 1 this year. And present, we are already receiving reports on lending to small and medium-sized businesses.

D.Medvedev: What’s the most common average amount of credit, and what’s the current interest rate on such credits?

V.Dmitriev: An average amount of credit ranges from 20 to 50 million rubles. But there are a lot of larger credits too…

V.Medvedev: I see. On average, it is this amount, isn’t it?

V.Dmitriev: Yes, it is.

D.Medvedev: It is this amount that small and medium-sized enterprises need to finance their day-to-day activity.

V.Dmitriev: You are quite right. And I should say that this system of support for small and medium-sized enterprises covers almost all constituent entities of the Russian Federation. 78 constituent entities of the Russian Federation are currently covered by this program and 80 regional banks are connected to it.

D.Medvedev: What about an interest rate after all?

V.Dmitriev: An interest rate offered by the Russian Development Bank is 10.5 percent and we insist…

D.Medvedev: What’s the real effective interest rate?

V.Dmitriev: The current real effective interest rate is about 15 percent.

D.Medvedev: 15 percent. Is there a chance that it will go down?

V.Dmitriev: Yes, there is. We are going to launch a new product this year. As the Russian Development Bank’s capital was increased by 10 billion rubles through Vnesheconombank’s contribution, we’ll able to reduce interest rates and by doing this we’ll encourage banks to expand financing but at new reduced interest rates. But by assuming risk we do not include it into the margin. And we hope to significantly reduce interest rates for end borrowers.

D.Medvedev: This is a very important issue. We have discussed it many times at our meetings with the Government with the participation of banks, with your participation. Of course, these decisions can’t be authoritarian, they must be economically feasible, and nevertheless our task is clear. We should seek to reduce interest rates on credits for our entire economy and especially for small and medium-sized enterprises.

V.DmitrieV: This is our priority. Moreover, by expanding our range of products we are also creating an infrastructure that would enable us to increase financing for small and medium-sized enterprises. And I would like to tell you that the Russian Development Bank together with the International Finance Corporation, a member of the World Bank Group, developed a special site.

At least, as of last August, it was the only unique site that allows both regional banks and small and medium-sized businesses to get information in this field of activity. Here, they can get information on the program of supporting small and medium-sized enterprises, educational programs for small and medium-sized enterprises, our regional partners we are cooperating with in supporting small and medium-sized enterprises.

D.Medvedev: Well, then, that’s a good thing actually.

And as far as crisis-management measures are concerned, my understanding is that everything is being done under the available programs and the decisions taken.

V.Dmitriev: Yes, it is. Moreover, our Supervisory Board made a decision that an income generated by Vnesheconombank from managing financial resources of the National Wealth Fund in the amount of 175 billion rubles (and we earned about 100 billion rubles) will remain with the Bank and will be used to finance top-priority lines of our activity such as mortgage lending, our participation in infrastructure projects as well as our participation in Rusal’s IPO as a core investor.