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. Last Updated: 07/27/2016

ORT Eyes VEB Loan to Pay VTB

State-owned television network ORT may receive a loan from state-owned Vneshtorgbank to repay a $117 million loan that it owes to another state-owned bank, Vneshekonombank.

VEB loaned ORT $100 million in 1999 to be repaid in one year, with a 13 percent stake in the TV network as collateral. VEB at the time was headed by Andrei Kostin, currently head of VTB.

ORT has not yet repaid the debt, which has grown to $117 million, and VEB has extended the deadline twice.

"Together with VEB we have designed a plan on a loan to ORT," Kostin said Wednesday. "However, the government should make the final decision."

The government, meanwhile, has decided to transfer all of VEB's commercial activities to VTB -- meaning that the ORT debt is being transferred to the bank from which the network is taking out the loan.

In June, Press Minister Mikhail Lesin had announced a plan to rid state-owned media companies of subsidies.

Lesin told ORT at a shareholders meeting that month that the network must pay back the debt to VEB, and ORT general director Konstantin Ernst pledged to do so by the end of the year.

Alfa Bank vice president Vagan Abgaryan, who manages second-tier private television station CTC, an ORT competitor, said Wednesday that he "did not expect anything else" from the state.

"If a state bank loans a state TV company money, then it is understood that it is subsidization," Abgaryan said. "In Russia it will be like this for a long time, and we plan to compete with ORT based on our own effectiveness."