Bank for Development and Foreign Economic Affairs (VEB)

 

Updated on November 2017

Nature and purpose

  • The “Bank for Development and Foreign Economic Affairs” (Vnesheconombank, VEB) and its activities are regulated by the Federal Law “On Bank for Development” (Federal Law nº 82-FZ, of May 17 2007)
  • The VEB’s investment priorities are: High value added production; transport and energy infrastructure; export in large scale projects; stimulating the use of defense industry facilities to manufacture civilian products, through new facilities and the modernization of existing production; innovation and national technology project initiatives.
  • It has seven representative offices in the Russian Federation (St. Petersburg, Khabarovsk, Ekaterinburg, Pyatigorsk, Krasnoyarsk, Rostov-on-Don and Nizhny Novgorod) and ten abroad (London, New Delhi, Mumbai, Milan, Beijing, New York, Frankfurt, Paris, Johannesburg and Zurich).

 

Fonte:  veb.ru/en/about

Where do resources come from?

  • During the dissolution of the USSR, the Bank’s activities were concentrated in the purchase of imported products, with financing from European countries.
  • In 2002, the Vnesheconombank was restructured and appointed to invest pension fund in bonds denominated in foreign currency.
  • In 2007, the Vnesheconombank was recast as “Bank for Development and Foreign Economic Affairs”. Thus, its authorized capital became a pool of funds from the former USSR, federal government-owned shares in the Russian Development Bank and the Roseximbank, as well as assets to be transferred by the own Russian government itself.
  • In 2010, the Vnesheconombank created the Russian Direct Investment Fund in order to raise capital abroad for the Russian economy. The main goal of the Fund is to raise
    long term foreign investment in the Russia’s high-tech sectors.
  • In 2015, as a result of the restrictions caused by the sanctions imposed on Russia, the Vnesheconombank was not able to obtain loans for more than 30 days in foreign capital markets. The solution was to seek increased resources from instruments in the securities market and alternative sources of resources, exploring new markets in Asia
    and the Pacific.

VEB’s Subsidiaries – How does it work?

The Vnesheconombank Group includes VEB’s subsidiaries which aim to execute a number of dispositions from the Federal Law “On Bank for Development”:

  • VEB-Engineering Company: created in the Vnesheconombank Group as a center for technical analysis of technological solutions on engineering, monitoring and management of national investment projects.
  • VEB-Capital: involved in the management of Vnesheconombank Group’s assets, including real property.
  • OJSC VEB-Leasing: gives assistance to small and medium enterprises in the financing of automotive transport and special equipment. The company opened 18 regional subdivisions in the biggest Russian cities.
  • GLOBEX Bank: offers credit support to the real economy and small and medium enterprises, with a tendency to function as a universal bank.
  • OJSC SME Bank: Vnesheconombank’s agent in the implementation of the Program of Support to Small and Medium Enterprises.
  • Roseximbank: Russian government’s agent to extend guarantees to exporters and arrange loans for importers of Russian products.
  • North Caucasus Development Corporation (OJSC): created to implement industrial and infrastructure projects in the District’s territory.
  • Vnesheconombank foreign banks subsidiaries (Belarus Belvnesheconombank; and Ukraine Prominvestbank): support the export of Russian products and the implementation of big joint investment projects in these countries

VEB’s Capital – How does it work?

VEB’s Capital is engaged in managing the Vnesheconombank Group’s assets, including real property assets, though greater importance is given to operations with financial assets.

 

  • Vnesheconombank’s loan portfolio includes Rubles, US dollars and Swiss francs, in addition to debt securities denominated on national and foreign markets.

 

Fonte: o autor, baseado em Vnesheconombank’s Annual Report (2015)

 

Fonte: o autor, baseado em Vnesheconombank’s Annual Report (2015)

 

Fonte: o autor, baseado em Vnesheconombank’s Annual Report (2015)