Sistema Gets New Loan Terms

Real estate developer Sistema-Hals has been forced to put up another 50 percent of its shares as collateral on a loan, a company source confirmed last week.

Under the terms of a loan from state bank VTB, half of a $700 million facility is secured by shares in Sistema-Hals itself.

The source said the company received a margin call on the loan about two weeks ago.

At the end of 2007, the loan was secured by 1.9 million, or 16.9 percent, of Sistema-Hals' shares.

The value of the collateral is based on the Sistema-Hals share price on the MICEX exchange, which has fallen by more than two-thirds since the beginning of the year, forcing Sistema-Hals to increase the number of collateralized shares.

VTB declined to comment on the matter.

Sistema-Hals' London-traded global depositary shares are down more than 90 percent since the beginning of the year, making it one of the worst-performing Russian securities as global investors have dumped real estate stocks.

A banking source at one of the country's most active lenders to the real estate sector said lenders typically expected shares held as collateral to be worth more than the loan.

"The value of the collateral is usually 30 to 50 percent higher than the bank loan, because shares are a fairly risky form of security," the banker said.