Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Germans Plan Komi Region Investments

Russia's Alfa-Bank announced Tuesday it has reached a credit agreement with a group of leading German banks on a 300 million deutsche mark ($200 million) loan to finance investment projects in the oil-rich Komi republic in Russia's Far North.


The money will come from a consortium of leading German banks -- Deutsche Bank, Dresdner Bank, KommerzBank and WestDeutsche Landesbank -- and will be channelled to Komi through AKA, a German insurance agency for export credits.


Under the terms of the agreement, the loan will be repaid by shipping raw materials, including oil, from Komi to Germany, Alfa-Bank -- Russia's 21st largest by assets -- said in a statement.


The agreement is similar to a 1.3 billion mark scheme for German financing of investment in the Urals region.


Alfa-Bank said the bank signed a long-term cooperation agreement with Komi regional authorities in June but did not indicate what period of time the credit arrangement would cover.


The money from the sales will be accrued at a special Alfa-Bank account at WestDeutsche Landesbank.


Komi regional authorities plan to use the first 60 million-mark slice of the loan to finance the four most promising projects, including a contract between the local telecoms company AO Svyaz and German supplier Alcatel Telecom to expand and modernize the region's telecommunications network.