OREANDA-NEWS. July 16, 2010. The EBRD and IFC, the private sector arm of the World Bank, have joined forces to raise USD 164 million for Russia’s Transcapitalbank, including a USD104 million loan syndication, whose success confirms the return of international appetite for the debt of strong private mid-size Russian banks despite continuing market turbulence, reported the press-centre of EBRD.

EBRD and IFC provided three-year A loans of USD 30 million each on their own account while an additional USD 104 million B loans was syndicated to a consortium of 12 commercial banks. The B loan provides for a bullet repayment at the end of the first year but its maturity can be extended for a further year at the commercial banks’ discretion.

The EBRD and IFC are the lenders of record for the full amount of USD 164 million.

The commercial banks participating in the B loan syndication include Commerzbank AG,  FBN Bank (UK) Ltd, ING Bank N.V., RZB, Standard Chartered Bank and VTB Bank (Deutschland) AG as initial mandated lead arrangers.

Other participants are: Amsterdam Trade Bank N.V. as mandated lead arranger; AKA Ausfuhrkredit-Gesellschaft mbH as lead arranger; Banque de Commerce et de Placements SA, London Forfaiting Company Ltd and the Royal Bank of Scotland N.V. as co-arrangers and ADRIA Bank AG as manager.The pricing of the B loans is 3.25 percent over 6-month LIBOR.

The success of this transaction shows that a a well-run mid-sized Russian private bank, which has proved resistant to the financial and economic crisis, can now once again tap international financial markets for medium-term funding, and eventually, for longer-term money, said Nick Tesseyman, the EBRD’s Managing Director in charge of the Financial Institutions sector.

This successful syndication, the first for Transcapitalbank since the start of the financial crisis, will allow us to provide competitive finance to our clientele and maintain the bank’s core lending activities,” said Olga Gryadovaya, Chairman of Transcapitalbank’s Management Board.  Transcapitalbank and its clients are positioned for growth, and this syndication provides the medium-term finance to underpin that growth, Mrs. Gryadovaya added.

“We see significant growth in commercial banks’ interest to provide financing to sustainable Russian private banks.  This syndication will send a strong signal to other investors and help re-establish the market for other Russian banks,” said Ritva Laukkanen, IFC Director for Syndications and Resource Mobilization.

These loans, arranged under the umbrella of EBRD and IFC, are aimed at facilitating Transcapitalbank’s return to international debt markets in order to maintain a diversified funding base and sustain its domestic lending programme to the real sector of the economy.

This is the second successful syndication the EBRD has arranged for a private Russian bank in the last month.

Founded in 1992, Transcapitalbank focuses on medium-sized corporates, as well as micro and small businesses, across 16 Russian regions. Its customer base consists of over 18,200 corporate clients and more than 153,000 retail ones.

The EBRD in December 2009 raised its stake in Transcapitalbank to 28.59 percent after agreeing to boost its Tier-1 capital by an extra 1.2 billion roubles. The EBRD originally acquired a stake of 25 percent plus one share in this bank in 2006.

This new transaction brings to USD 153.6 million the total amount of facilities provided by the EBRD to Transcapitalbank since the beginning of their relationship in 2004.