Moscow. December 9. The Finance Ministry believes that the participation of the state budget funds in support of Vnesheconombank’s only after he runs out of the ability to repay their obligations at the expense of means from sale of assets, told journalists the Minister of Finance Anton Siluanov.
“Our proposal is not to issue the full amount (to release for OFZ recapitalization of VEB). A total of approximately 1.7% of GDP – may increase the deficit (the Federal budget) and debt, we do not need it. You must first use the resources of the VEB within the framework of realization of its assets that have been accumulated. If the web through sale of its assets will not be able to repay the obligation, the Federal budget will shoulder and will come to his aid. In this format, we are ready to provide support for VEB. But not the right to issue this amount of debt and to invest in the capital,” he said.
According to the Minister, to work with the assets of the Bank will take time. “One-time clearing of balance does not stimulate the management to improve the work with assets,” said he also.
Earlier, the head of the Ministry of economic development Alexei Ulyukayev expressed the view that the recapitalization of VEB is best done through the OFZ and make Bank in a commercial zone is fully supervised by the CBR.
Siluanov said that the Finance Ministry against the option with the additional capitalization of Vnesheconombank by referring OFZ, although he acknowledged that as one of the options this option is discussed. He also noted that, in the opinion of the Ministry of Finance, the support of VEB at the expense of the Russian budget should not be instantaneous and should not seriously affect the overall balance of the budget.
Prime Minister Dmitry Medvedev held a meeting on the support of VEB, on 4 December, but, according to two sources, the final decision was taken, probably another meeting, and perhaps the Prime Minister will report to the President on this issue.
VEB requires government support to avoid default on debt obligations. Called different numbers for state aid, up to 1.5 trillion rubles. In the first half of 2015, the web has received a net loss under IFRS 73.5 billion rubles due to the high costs of loan impairment provisions. The main source of problems of VEB loans under the so-called “special projects” that the Bank issued by resolution of the Supervisory Board and now no revenue.
Among the proposed measures is the capitalization of the Corporation via OFZ scheme to support the banking sector, but it does not suit the Ministry of Finance. Other options – the ransom of Russian authorities debt of VEB or exchange its Eurobonds on the issue of Eurobonds of the Ministry of Finance, then the state itself will pay off the foreign debt of the Bank. An additional option of raising capital is the sale of shares of public companies on the balance sheet of Vnesheconombank, Gazprom and RUSAL, but now they are much cheaper than at the time of purchase, and their sale is fraught with losses.
In December of this year VEB has to repay a syndicated loan of $800 million According to the presentation of the Corporation, its external debt due in 2016 is estimated at $893 million, 2017 – $1.85 billion.
Will also have to decide on the fate of troubled assets VEB that may depart the state. Restructuring of VEB may affect banks that it sanitizes on funds from the Central Bank – the Bank Globex and Svyaz-Bank.