Install

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

. Last Updated: 07/27/2016

TUSRIF Purchases Local Bank

The U.S. Russian Investment Fund will announce next week that it has acquired Moscow’s Development and Restructuring Bank, an employee of the bank said this week.

The fund, or TUSRIF, has already replaced the bank’s top manager with its own employee, John Grimmett, and will rename the bank to its English abbreviation, DRB, said the source, who asked not to be named.

The value of the deal is unknown, but it is unlikely to be particularly high, analysts said. DRB’s assets were valued at just 112 million rubles ($4.1 million) as of Aug. 1, and its own capital on the same date was just 37.7 million rubles.

Thomson BankWatch Moscow representative Richard Hainsworth said the move would be logical because TUSRIF – a private investment firm established by the U.S. Congress in 1995 with $450 million in available capital – needs its own bank for insurance purposes.

The move will also enable the fund — which concentrates on consumer and small business loans — to distribute its resources more effectively, which at present go through tens of small- and medium-sized banks because most of the bigger banks prefer not to work with consumer crediting.

DRB was established in 1997 by Dialog Bank shareholders for providing the same services TUSRIF specializes in — small mortgage and consumer loans. Dialog Bank itself was in trouble after the crisis of 1998, while DRB remained afloat and unharmed. Many Dialog employees were transferred to DRB, as was the Dialog’s entire credit-card business. By the middle of 1999, a significant portion of DRB’s loan portfolio was made up of plastic card and mortgage credits. The bank also provides small loans for automobile purchases.

Through September of this year, TUSRIF has allocated $4 million in mortgage loans, with another $13 already approved. Overall TUSRIF lending in 2000 totals some $100 million.