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. Last Updated: 07/27/2016

Development Bank to Lend $40Bln

MTVneshekonombank's offices in Moscow. The bank will lead state investment by raising its loan portfolio to $40 billion.
Vneshekonombank, the country's sixth-largest bank, was given a fresh lease of life Wednesday in its new status as a state investment bank.

"We will do both loans and capital investment, just like international development institutions," Vneshekonombank CEO Vladimir Dmitriyev told reporters Wednesday.

President Vladimir Putin decreed last month that Vneshekonombank would be enlarged into a state corporation by incorporating Roseximbank and the Russian Development Bank.

Vneshekonombank will lead the charge in state investment by increasing its loan portfolio to $40 billion by 2010, Dmitriyev said. The bank also intends to borrow $15 billion, he said.

The bank's capitalization, which now stands at 70 billion rubles ($2.7 billion), is expected to top 250 billion rubles by the end of the year, Dmitriyev said

"We are a specialized financial institution in that we are the only bank [in Russia] to operate without a Central Bank license," Dmitriyev said.

Dmitriyev said the bank was born out of a need for a strong financial institution that could enable the development of an innovative economy -- a role in which the bank hopes to play a major role.

"We are not part of any profit-making business," Dmitriyev said, adding that the bank's priority would be lending support to government projects.

Anatoly Aksakov, president of the Association of Regional Banks and a Duma deputy, said Vneshekonombank was ideally suited to the role of a development bank because it has all the resources and experience.

"Vneshekonombank has signed agreements with the Association of Regional Banks to enable it to work effectively in the regions as well as to provide financial assistance to small and medium-sized businesses," he said.