OREANDA-NEWS. PSB Finance S.A. (the "Offeror") has today launched invitations to holders of the outstanding notes detailed in the table below, issued by (but with limited recourse to) it for the purpose of financing a corresponding loan to Promsvyazbank Public Joint-Stock Company (the "Borrower") (each of the series of Notes referred to below, a "Series", and all outstanding notes of all Series together, the "Notes"), to tender their Notes for purchase by the Offeror for cash (each such invitation, an "Offer" and, together, the "Offers") at prices to be determined pursuant to a modified Dutch auction.

The Offeror proposes to purchase up to an aggregate principal amount across all Series of Notes such that the aggregate Purchase Consideration shall not exceed \$250,000,000 (the "Maximum Acceptance Amount") although the Offeror (acting jointly with the Borrower) reserves the right, in its sole discretion, to purchase less than or more than the Maximum Acceptance Amount.

The Offeror will pay an amount equal to accrued and unpaid interest in respect of all Notes validly tendered and accepted for purchase by the Offeror.

Description of the Notes

Common code/ISIN

Outstanding principal amount

Minimum Denomination

Minimum Purchase Price

Purchase Price

Maximum Acceptance Amount

U.S.\$200,000,000 11.25 per cent. Loan Participation Notes due 2016  issued as Series 4 under the Programme   (the "2016 Subordinated Notes")

U.S.\$189,052,000

U.S.\$100,000

U.S.\$990 per U.S.\$1,000 in principal amount of 2016 Subordinated Notes

To be determined as set out herein pursuant to a modified Dutch auction procedure

Up to an aggregate principal amount across all Series of Notes such that the aggregate Purchase Consideration shall not exceed \$250,000,000

U.S.\$400,000,000 8.5 per cent. Loan Participation Notes due 2017 issued as Series 6 under the Programme  (the "2017 Senior Notes")

U.S.\$400,000,000

U.S.\$200,000

U.S.\$950 per U.S.\$1,000 in principal amount of 2017 Senior Notes

U.S.\$600,000,000 10.20 per cent. Loan Participation Notes due 2019 issued as Series 7 under the Programme (the "2019 Subordinated Notes")

U.S.\$484,540,000

U.S.\$200,000

U.S.\$800 per U.S.\$1,000 in principal amount of 2019 Subordinated Notes

Capitalised terms used in this announcement but not otherwise defined have the meanings given to them in the Tender Offer Memorandum dated 4 February 2015.

Introduction

On the terms and subject to the conditions contained in the Tender Offer Memorandum, the Offeror invites Noteholders (subject to the Offer and Distribution Restrictions contained herein) to tender their Notes for repurchase by the Offeror at the relevant Purchase Price together with Accrued Interest.

Rationale for the Offers

The purpose of the Offers is to enable the Borrower to deem certain of its outstanding loans from the Offeror to be prepaid, in an amount corresponding to the aggregate principal amount of Notes purchased by the Offeror pursuant to the Offers, which is reflective of the Borrower's liquidity position and consistent with its ongoing liability management objectives. As a result of the consummation of the Offers, the Borrower expects to redeem the amortised portion of its outstanding "old-style" subordinated loans corresponding to the 2016 Subordinated Notes and the 2019 Subordinated Notes, save on coupon payments and improve the Borrower's Tier 1 capital by recording Retained Earnings.  The Offeror and Borrower also believe that the Offers will provide an opportunity to Noteholders to realise liquidity with respect to their Notes that might not otherwise be available to such Noteholders.

The Offeror has entered into an agreement with the Borrower under which it will procure the purchase of certain of the Notes. The purchases of such Notes by the Offeror will be financed with funds it receives from the Borrower pursuant to such agreement, and all such purchased Notes will be cancelled by the Offeror (subject to, with respect to the 2016 Subordinated Notes and the 2019 Subordinated Notes, approval from the CBR for the prepayment of the relevant loan as outlined in the "Risk Factors and Other Considerations" under the heading "The 2016 Subordinated Notes and the 2019 Subordinated Notes may only be cancelled following prior written consent of the CBR for the prepayment of the relevant loan") and the loan shall be deemed to have been prepaid by the Borrower in an amount corresponding to the aggregate principal amount of the Notes surrendered for cancellation.

The Borrower will continue to consider opportunities to repurchase its debt based on several factors, including without limitation its borrowing costs and the overall remaining tenor of its debt portfolio.

Purchase Price

The Offeror will pay for each Series of Notes validly tendered and accepted by it for purchase pursuant to the relevant Offer a cash purchase price per U.S.\$1,000 in principal amount of Notes (for each Series of Notes, a "Purchase Price") as determined pursuant to the Modified Dutch Auction Procedure described below.

Modified Dutch Auction Procedure

Under the Modified Dutch Auction Procedure, the Offeror will determine, in its sole discretion, (i) the aggregate principal amount of each Series of Notes (if any) that it will accept for purchase pursuant to the relevant Offer (each such amount, a "Series Acceptance Amount") and (ii) the Purchase Price for each such Series of Notes validly tendered and accepted for purchase, in each case taking into account the aggregate principal amount of each Series of Notes so tendered and the purchase prices specified (or deemed to be specified, as set out below) by tendering Noteholders.

The Purchase Price will represent the lowest price that will enable the Offeror to purchase an aggregate principal amount of 2016 Subordinated Notes, 2017 Senior Notes or 2019 Subordinated Notes, as the case may be, which equals the relevant Series Acceptance Amount and shall either be the applicable Minimum Purchase Price, or an increment of U.S.\$1.25 per U.S.\$1,000 in principal amount of the relevant Series of Notes above such Minimum Purchase Price.

Tender Instructions may be submitted in the form of either a Non-Competitive Offer (which does not specify a purchase price, or which specifies a purchase price lower than or equal to the relevant Minimum Purchase Price) or a Competitive Offer (which specifies a purchase price higher than the relevant Minimum Purchase Price).

Acceptance Amount and Scaling

Each Series Acceptance Amount (if any) will be determined by the Offeror, in its sole discretion. If the aggregate principal amount outstanding of Notes of a particular Series validly tendered at or below the relevant Purchase Price is greater than the relevant Series Acceptance Amount, the Offeror intends to accept all Securities tendered for purchase at the relevant Purchase Price on a pro rata basis, as further described in the Tender Offer Memorandum.

Timetable for the Offers

The expected timetable of events will be as follows:

Date

Action

Wednesday, 4 February 2015

Commencement of the Offers

Offers announced by way of announcements on the relevant Notifying News Service(s), through the Clearing Systems and via the websites of the London Stock Exchange and the Irish Stock Exchange.

Tender Offer Memorandum available from the Tender Agent.

Wednesday, 11 February 2015 at 16.00 hours, London time

Expiration Deadline

Deadline for receipt by the Tender Agent of all valid Tender Instructions in order for Noteholders to be able to participate in the Offers.

Thursday, 12 February 2015

Announcement of Purchase Price(s), Acceptance and Results

Announcement by the Offeror of:

(i)      in respect of the 2016 Subordinated Notes, whether the Offeror will accept valid tenders of the 2016 Subordinated Notes pursuant to the Offers and if so accepted, the 2016 Subordinated Notes Acceptance Amount, the 2016 Subordinated Notes Purchase Price and the Scaling Factor (if applicable) to be applied to valid tenders of the 2016 Subordinated Notes;

(ii)     in respect of the 2017 Senior Notes, whether the Offeror will accept valid tenders of the 2017 Senior Notes pursuant to the Offers and if so accepted, the 2017 Senior Notes Acceptance Amount, the 2017 Senior Notes Purchase Price and the Scaling Factor (if applicable) to be applied to valid tenders of the 2017 Senior Notes; and

(iii)    in respect of the 2019 Subordinated Notes, whether the Offeror will accept valid tenders of the 2019 Subordinated Notes pursuant to the Offers and if so accepted, the 2019 Subordinated Notes Acceptance Amount, the 2019 Subordinated Notes Purchase Price and the Scaling Factor (if applicable) to be applied to valid tenders of the 2019 Subordinated Notes.

Friday, 13 February 2015

Settlement

Expected Settlement Date for the Offers.

 

 

General

The complete terms and conditions of the Offers are set forth in the Tender Offer Memorandum, which will be sent to eligible Noteholders at their request. Noteholders are urged to read the Tender Offer Memorandum carefully.

The Borrower and the Offeror have retained J.P. Morgan Securities plc and Soci?t? G?n?rale to act as Dealer Managers for the Offers.

Operational Procedure Description

In order to participate in the Offers, Noteholders must validly tender their Notes by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender Agent prior to 16:00 hours, London time, on Wednesday, 11 February 2015. Tender Instructions must be submitted electronically in accordance with the procedures of the relevant Clearing System, and shall be irrevocable, according to the terms and conditions, contained in the Tender Offer Memorandum.

If you need further information about the Offers, please contact any of the Dealer Managers or the Tender Agent.