ZENIT's corporate loan portfolio increased more than 35% in 2005 to $1,206 million equivalent as of the year end
The Bank's corporate loan portfolio increased more than 35% in 2005 to $1,206 million equivalent. The growth of the Bank's loan portfolio is primarily related to continued successful implementation of its Regional Development Programme and the growth of the working capital financing portfolio (more than 1.5 times). It should be emphasised that ZENIT achieved such results in spite of a stronger competition for large corporate client financing between Russian banks.
Bank's principal clients in terms of working capital financing included companies representing the food, machine building (inter alia, MTC), metal and oil industries, and trade. In 2005, ZENIT pursued an aggressive policy offering syndicated loans, a rather rare service for the Russian banking system. In 2005, the Bank arranged and participated in syndicated loans totalling RUR1,240 million for a number of leading food, oil production and machine building companies. With a view to further development of investment lending, Bank ZENIT started implementing a number of new investment projects in 2005 and offered its clients convenient financing schemes using various banking instruments. Thus, 20 new investment projects involving Bank ZENIT were launched in 2005. The Bank's investment loan portfolio reached $433 million by the year end. Over 50 Russian companies operating in various sectors of economy used ZENIT's investment loans in 2005.
Bank ZENIT continued its operations in the trade finance and documentary market in 2005. It issued guarantees in excess of $291 million which is higher than the 2004 level by more than $36 million. The aggregate amount of LOCs issued by the Bank was over $113 million, and about 70% of them were issued using credit lines opened by western banks for Bank ZENIT.
It is also noteworthy that limits opened for Bank ZENIT by European credit agencies -Euler Hermes (Germany), Coface (France), KUKE SA (Poland), EGAP (Czech Republic), EKF (Denmark), and SACE (Italy) - also increased significantly.
The amount of trade finance credit lines opened for Bank ZENIT by foreign banks continued to increase in 2005. Total credit line limits opened by foreign financial institutions for Bank ZENIT grew 20% compared to 2004, which confirms a high level of confidence enjoyed by the Bank in the international market.
In December 2005, Bank ZENIT launched a pilot programme to extend loans to small and medium businesses. The programme would allow covering a viable sector of the Russian economy insufficiently covered by banks. The programme would make a special emphasis on the Bank's regional offices.
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