Moscow, July 8, 2005 — The International
Finance Corporation (IFC), the private sector financing arm of the World
Bank Group, signe an agreement today to provide a $5 million loan to Credit
Bank of Moscow (CBM), a private Russian bank focused on small- and medium-size
enterprises (SMEs), entrepreneurs, and retail clients. IFC’s loan
will support the expansion of the Bank’s mortgage lending program. This
loan is IFC’s second transaction with the Bank and builds on a partnership
begun in 2004, when IFC extended a $10 million loan to the Bank for on-lending
To date, IFC has provided over $140 million in financing for development
of the mortgage industry in Russia. However, this is the first housing
finance loan to a Russian-owned bank. It is expected that CBM will
also participate in the Russian Primary Mortgage Market Development project
sponsored by IFC with an aim at improving industry standards.
“Housing finance is a key priority for IFC in the Russian financial market
and we are excited to start working with Russian banks in this area. While
the financial market in Moscow is more developed than in other parts of
Russia, demand for mortgage loans continues to be very high. We are pleased
to support CBM’s mortgage lending program which will play an important
role in raising living standards of Muscovites” -- commented Edward Nassim,
IFC’s Director for Central and Eastern Europe.
Jyrki Koskelo, Director for Global Financial Markets Department said: "IFC’s
support to the Credit Bank of Moscow is consistent with our overall corporate
strategy to work with credible mortgage loan originators to help increase
access to long term and affordable housing finance in emerging markets.
At IFC, we recognize that housing finance is a key ingredient to
wealth creation, as a home is the most important investment that most individuals
make in their life time." Mr. Koskelo added, " IFC's key
development objective for housing finance is to foster development of strong
primary markets that could eventually help to create a link to support
financial and capital market development, through secondary mortgage market
Mr. Alexander L. Khrilev, Chairman of the Board - President of Credit Bank
of Moscow, noted that: "We are delighted to further partner with such
a reputable and experienced international institution as IFC. Longer
term funding is essential in addressing the needs of housing finance market.
Therefore our capabilities as a mortgage finance provider will be
enhanced as we tap IFC's financial resources and expertise. We believe
the latter will provide valuable support for our new mortgage lending strategy.
Hopefully, this will prove to be another successful page in the history
of our collaboration, and there will be more to follow."
Credit Bank of Moscow was founded in 1992 and now ranks No.66 (by total
assets and by equity) in Russia. In October 2004, Moody’s Interfax
upgraded CBM’s national scale rating to A3 (rus). In July 2004 Moody’s
confirmed its E+ financial strength and B1/NP foreign currency deposit
ratings. In April 2005, Fitch Ratings upgraded CBM’s national scale rating
to BB+ form BB (rus) and affirmed the bank’s international ratings in
June 2005. Ros Business Consulting listed the bank as one of Top
3 Russian banks to provide consumer car loans in 2004. The Bank is also
collaborating with EBRD on trade finance and SME lending ($10 million facility).
CBM’s operations are based in Moscow and the Moscow Region.
International Finance Corporation (www.ifc.org)
Russia joined IFC in 1993. Since then, IFC has committed $1.8 billion,
including $200 million in syndicated loans, to finance 92 projects across
a variety of sectors. To date, IFC’s portfolio in Russia stands at approximately
$1.4 billion. IFC’s investments spread across the country’s most
important sectors including banking, leasing, housing finance, infrastructure,
mining, agribusiness, pulp and paper, construction materials, oil and gas,
telecommunications, information technologies, retail, and health care.
The mission of IFC is to promote sustainable private sector investment
in developing countries, helping to reduce poverty and improve people’s
lives. IFC finances private sector investments in the developing world,
mobilizes capital in the international financial markets, helps clients
improve social and environmental sustainability, and provides technical
assistance and advice to governments and businesses. From its founding
in 1956 through FY04, IFC has committed more than $44 billion of its own
funds and arranged $23 billion in syndications for 3,143 companies in 140
developing countries. IFC’s worldwide committed portfolio as of FY04 was
$17.9 billion for its own account and $5.5 billion held for participants
in loan syndications.