ZAO Raiffeisenbank Austria

MIGA issued a guarantee of $28.5 million to Raiffeisen Zentralbank Österreich AG of Austria for its $30 million shareholder loan to ZAO Raiffeisenbank Austria (RBRU) of the Russian Federation. The guarantee is for a period of five years and provides coverage against the risks of currency transfer restriction and expropriation.

RBRU provides account and payment services for corporate clients, documentary business and guarantees, loans, treasury services, consumer banking and other services. The investment will finance the expansion of RBRU’s operations in Russia and will strengthen the asset base of RBRU.

This investment will have several important developmental impacts for the Russian economy. It will support the development of the Russian financial sector through the pro-vision of short, medium, and long-term lending, and the introduction of new financial products. It will also stimulate export growth and small and medium enterprise devel-opment through the on-lending of funds to local SMEs that are expected to generate export revenues. In addition, local skills will be developed by RBRU as it continues to hire managers locally and train them using RZB’s network for on-and off-site staff training.

The project is consistent with the World Bank Group Country Assistance Strategy for the Russian Federation, which specifically seeks to promote the diversification of the economy to reduce the reliance on the natural resource sectors. ZAO Raiffeisenbank Austria’s portfolio of banking products to SMEs will offer new and improved financial services to start-up, small, and entrepreneurial ventures.