MOSCOW, RUSSIA, October 18, 1999 — The
International Finance Corporation has signed an agreement to invest in
Deutsche Leasing Vostok (DLV), a general equipment leasing company to be
established in Russia. DLV will be the country's first joint venture leasing
company with significant foreign ownership. It is also IFC's first leasing
project in Russia.
IFC's financing consists of an equity investment of US$600,000, representing
a 20 percent stake in the new company, and a loan of up to $3 million.
The project sponsor is Deutsche Sparkassen Leasing AG & Co. KG, Germany's
largest independent leasing company and one of the top ten leasing companies
The project will help develop the private sector in the Russian Federation
through lease financing and related services to the agricultural, construction,
energy, industrial, mining, and transport sectors. The project will provide
critical medium-term financing for private enterprises at a time when few
alternatives exist as a result of the Russian financial crisis.
The project evolved from IFC's extensive technical assistance efforts in
the Russian leasing sector, beginning in 1997 with the creation of IFC's
Leasing Development Group (LDG) in Moscow. IFC's on-going technical assistance
work in the Russian leasing sector is supported by both the British Know-How
Fund and the Canadian International Development Agency.
Mr. Edward Nassim, Director of IFC's Europe II Department, said that the
investment in DLV will help to promote leasing as an effective and viable
means of capital financing. IFC will continue to promote the growth of
the leasing sector in Russia through its technical assistance program,
The mission of IFC, part of the World Bank Group, is to promote private
sector investment in developing countries, which will reduce poverty and
improve people's lives. IFC finances private sector investments in the
developing world, mobilizes capital in the international financial markets,
and provides technical assistance and advice to governments and businesses.