(MONTREAL) – June 19, 2007 – Export Development Canada (EDC), the European Bank for Reconstruction and Development (EBRD), and Raiffeisen Leasing (Russia) today signed an agreement for an innovative USD 45 million leasing program designed to facilitate purchases of equipment by small- to mid-sized buyers in the Russian Federation from vendors located in Canada and other EBRD member countries.
The agreement was signed by EBRD President Jean Lemierre and EDC President and CEO Eric Siegel at the Conférence de Montréal in Canada. Mr. Siegel and Mr. Lemierre underlined the broad advantages of the program that will offer the unique opportunities of leasing in the Russian market and the strong market position of Raiffeisen Leasing, one of Russia’s leading leasing companies.
“Russian mid-tier markets are experiencing explosive growth, but are constrained by lack of access to capital,” said Mr. Siegel. “At the same time, exporters from Canada and elsewhere have been looking for a lease financing mechanism that can help them serve this market. We tailored the program to this specific market and scenario, and we believe that it will greatly help develop opportunities for vendors.”
Mr Lemierre said that this unique framework had allowed the EBRD and its partners to jointly assume the risk of direct lending to medium and small-sized Russian clients, using leasing as a highly efficient financing vehicle. “The EDC and the EBRD designed this framework together. We at the EBRD look forward to working with the EDC and other lenders in the coming months and years,” he added.
Transactions under the program will be financed jointly by EBRD and EDC (or, in the case of non-Canadian transactions, a third financial institution), with each lending 45 per cent. Raiffeisen Leasing will hold 10 per cent of the risk. Among the aspects of the framework are expedited processing times for lease proposals, standardized due diligence, and non-recourse of the lenders to the borrower and the lessor (Raiffeisen Leasing).
The EBRD, owned by 61 countries and two intergovernmental institutions, aims to foster the transition from centrally planned to market economies from central Europe to central Asia.
Raiffeisen Leasing, a subsidiary of Vienna-based RZB, offers financial leasing, mainly for industrial equipment and vehicles, to sectors including construction, telecommunications and transport. Outlets are located in Moscow, St. Petersburg, Ekaterinburg, Samara, Novosibirsk, Nizhni Novgorod, and Krasnodar.
EDC is Canada’s export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC’s knowledge and partnerships are used by 7,000 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining and is a recognized leader in financial reporting, economic analysis and has been named one of Canada’s Top 100 Employers for six consecutive years.
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Media contacts: Phil TaylorEDC Public Affairs (613) 598-2904 ptaylor@edc.ca
Anthony WilliamsEBRD Communications Department+44 207 338 6997williama@ebrd.com
