Dmitry Medvedev’s opening remarks:

There are many items to discuss. Today we’ll consider a number of important issues. First of all, I’d like to note the successful debut issue of the Euro-denominated Eurobond. I know that they generally enjoy demand from foreign investors, and this is a good sign that reflects the confidence of the world business community in the bank and in Russia as a whole. This is good considering certain international events, some strange and controversial decisions that are being made by some EU countries – I’m referring to Cyprus. Let’s be straight about this – this looks like confiscation of someone else’s money. I don’t know who came up with this idea, but this is how it seems. Regrettably, we have been aware of this practice during the Soviet times, when money was exchanged with a coefficient and not returned to people in full. But Cyprus is a country with a market economy and is supposed to be a member of the European Union. Of course, we will have to draw certain conclusions from this because we have our own relations with Cyprus and we will continue the consultations. But we will have to make certain adjustments in our position even with the understanding that in general it would be better to keep the money in Russian banks.

However, we should give more thought to this, and to our attitude toward the business climate and the development of business initiatives in this country: this example defies our efforts to create a normal business climate. Okay, this is a lyrical digression related to those international events that are shaking markets and affecting currency rates.  

Now on to the agenda. One issue has to do with approving the programmes for issuing VEB classical and exchange bonds for a total of 590 billion roubles. This will offer the bank more flexibility when choosing a timeframe for placing bonds. Having efficiently placed bonds on the market, the bank will receive long-term loans on favourable conditions, and will use these funds to finance large investment projects. 

Next. We will also have to discuss the main parameters of deals on investing pension accruals. I remind you that in late 2009, VEB was granted the possibility to purchase – with the accruals in pension funds – non-state securities, and to form additional instruments to attract long term money to the real sector, which is important. As of January 31, 2012, such securities were purchased for 330 billion roubles, and the investment portfolio profitability was over 9%, or 2.5% higher than the yearly inflation level.

In addition, restrictions on purchasing bonds with state security were lifted. Restrictions were lifted on purchasing domestic company bonds with a rating of long-term business solvency equalling or exceeding the sovereign rating. To improve the security of pension money, the main parameters of the deals, the planned volume of purchasing and maturity, should be approved by the VEB Supervisory Board. 

VEB has received official requests from Russian Railways, from the Federal Grid Company, the Agency for Housing Mortgage Lending and some other companies to place bonds for some 240 billion roubles this year.  

The funds will be used to finance long-term infrastructure projects, for individual housing problems, for developing and introducing innovation technology, various technologies including transport technology that is being adopted by Russian Railways. For example, the Federal Grid Company needs money to reconstruct substations in various regions. Other companies also need money for their long-term projects. 

In addition, we will discuss possible participation in the programme of another 30 companies that wish to place bonds for over 200 billion roubles this year. We will look into the bank’s regulatory documents including risk management policy. This should establish unified risk management principles and forms of accountability within the VEB Group. I know that the experience of the best global practices and leading development institutions has been utilised; the recommendations of the Basel Committee on Banking Supervision have been implemented, too. I hope that this will improve the overall financial stability of the VEB Group and the efficiency of bank assets’ management.

And the last point. Today we must approve the composition of the Tender Commission on Development Award founded by VEB in 2012. VEB will award companies and organisations at the St. Petersburg International Economic Forum. This is the right idea: to award the implementation of quality investment programmes and projects. It is planned for leading experts and officials of government economic agencies and VEB representatives to choose nominees.

This is further confirmation that we have done our best to improve our business climate and support those who observe the law and work efficiently.

Let’s start to discuss this large number of issues – we have 23 items for discussion today. 

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VEB Chairman Vladimir Dmitriyev takes questions from journalists after a meeting of the Vnesheconombank Supervisory Board

Vladimir Dmitriyev: At the meeting of the Supervisory Board of Vnesheconombank, we considered about 20 issues related to Vnesheconombank current activities in investment projects and the Supervisory Board’s coordination of a number of regulatory documents governing the bank’s activities. With regard to issues related to Vnesheconombank, I would like, first of all, to mention the Supervisory Board’s approval of a borrowing programme on the domestic market. This involves issuing rouble- and foreign currency-denominated bonds in the amount of 590 billion roubles. Vnesheconombank’s investment plan for 2013 provides for allocating about 770 billion roubles to support investment projects. Of course, a portion of this funding will come from domestic rouble- and foreign currency-denominated bonds. For rouble bonds, the amount is 220 billion roubles, for dollar bonds we plan two issues $500 million each, and the euro bond issues will amount to 300 million and 500 million euros.

We also reviewed issues related to financing several Olympic facilities based on the changing situation, and supporting investors involved in investment projects. We have considered the matter of increasing lending limits for several resident banks. There were a number of issues relating to harmonising regulatory documents that govern routine operations at Vnesheconombank. We discussed our lending and risk management policies as they apply to the entire Vnesheconombank Group. We also discussed issues related to the activities of foreign Vnesheconombank subsidiaries and took appropriate decisions to support their financial activities. I’m referring to loans for the current investment activities of our subsidiaries.

Today, we approved Ernst and Young as the auditor for our operations within the Export Loan and Investment Insurance Agency.

Speaking of auditing, we adopted the Vnesheconombank auditor's report for the fourth quarter of 2012 and the report of the officer responsible for compliance with the bank’s insider information requirements.

That’s all that we discussed today. Speaking about the approval of regulatory documents by the Supervisory Board, we have made ​​significant progress with regard to introducing uniform operating standards for Vnesheconombank.

Question: Did you discuss the Cyprus issue, which Mr Medvedev brought up early on during the meeting?

Vladimir Dmitriyev: No.

Question: What do you think about this decision by the government of Cyprus?

Vladimir Dmitriyev: I’m not sure I can say it any better than the Prime Minister and the chairman of our Supervisory Board.

Question: Did Mechel ask VEB to fund the development of the Elginskoye deposit?

Vladimir Dmitriyev: Yes.

Question: How much are they asking for and how much is VEB prepared to give?

Vladimir Dmitriyev: We need to look into their proposal at the corporate level and then we’ll discuss funding amounts.

Question: You said you discussed the issue of using lending limits for resident banks. Are you doing this as part of Olympic facilities’ construction?

Vladimir Dmitriyev: No, it’s part of our routine business with them.

Question: Which banks are these and what amounts are we talking about?

Vladimir Dmitriyev: I’m not sure about the amounts, but the banks are VTB, MSP and Sberbank.

Thank you.