|                                                                                                                                                             |  | EX-IM WORKS MORE WITH RUSSIAN BANKS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
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|**BISNISHome PageSearchBISNISEmbassyReportsCountryReportsIndustryReportsPublicationsSourcesof FinanceLeadsand EventsExchangeRatesState ExportsOtherSources** |  | June 1998by Padraic J. SweeneyRussian commercial banks are becoming important partners for the Export-Import Bank of
the United States (Ex-Im ) in financing U.S. exports to Russia, as the Russian Government
reduces its use of sovereign guarantees.  Ex-Im officials noted the shift towards greater
cooperation with Russian banks at the 1998 Ex-Im annual conference, May 7 - 8, in Washington,
DC.Commercial Banks Criteria for Consideration
Ex-Im considers Russian commercial bank risk on a case-by-case basis.  Although it has no list of
"approved" Russian banks, it does set minimum criteria for banks whose risk it will consider.  The
minimum criteria include three years of audited financial statements, in English; financial
statements audited to international accounting standards (IAS); unqualified opinion(s) from a
Western accounting firm concerning the financial condition of the bank; minimum capitalization of
$15 million, and minimum total assets of $100 million.  There is no preset exposure limit for
Russian banks.Ex-Im takes a conservative approach to working with Russian commercial banks: building
exposure gradually with individual banks, developing satisfactory payment experience, and then
expanding activities.  The maximum repayment term currently available for Russian banks is five
years.  Commercial banks owned by the Russian Government are considered on a nonsovereign
basis.  This approach applies to all Ex-Im Bank programs (loans, guarantees, and insurance).The shift to commercial banks will be particularly important for companies financing exports
under Ex-Im's "Oil and Gas Framework Agreement" (OGFA), which accounts for approximately
50 percent of all its transactions in Russia.  In the future, all borrowers using OGFA will have to
be from the private sector.  Repayment conditions have been eased for OGFA transactions, and
payments can now be made from any existing oil production of the borrower, whether or not it is
derived from the project being financed.Medium-Term Credit Standards
Ex-Im officials also presented new "Medium-Term Credit Standards" at the annual conference. 
The standards, which were adopted recently in order to simplify and expedite processing of
medium-term transactions, define the criteria the bank will apply in evaluating creditworthiness of
the primary source of repayment in such transactions.  Ex-Im Bank defines medium-term
transactions as those involving exports of capital goods and services with a financed amount not
exceeding $10 million and repayment terms of seven years of less.  Insurance, guarantees, and
loans are all medium-term programs.Ex-Im Bank is an independent federal agency that supports American jobs by financing the sales
of U.S. goods and services to foreign markets.  In fiscal year 1997, Ex-Im Bank supported U.S.
exports worth more than $15 billion.  As of March 31, 1998, Ex-Im had financed 50 transactions
in Russia worth $2.1 billion. For more information, visit the Exim Bank home page
at http://www.exim.gov.Padraic J. Sweeney covers finance for BISNIS.This report is provided courtesy of the Business Information Service for the Newly
Independent States (BISNIS)