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MDM-Bank to spend $20 mln of IFC loan on energy projects

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MOSCOW, July 26 (RIA Novosti) - MDM-Bank, a leading Russian commercial bank, said Thursday it would channel $20 million of a $100 mln loan facility received from the World Bank Group's vehicle for private sector investment, to finance energy-efficient technologies.

Michel Perhirin, the MDM-Bank board chairman, said the funds from the $100 mln International Finance Corporation (IFC) loan facility granted to the bank in June would go to help small and medium business acquire energy-saving equipment. Loans will be granted for a term of 5-7 years, he said.

The board chairman said the remaining $80 million would be spent on the bank's mortgage program and also on small and medium business lending.

According to Perhirin, the portfolio of MDM-Bank mortgage loans is expected to reach $450-500 million by the end of 2007 compared with $242 million as of July 1.

MDM-Bank will sell 5% of its charter capital to the IFC, the world's largest multilateral source of loan and equity financing for emerging market private sector projects, for $184 million, said Yulia Kochetygova, the head of the bank's department for corporate relations.

According to Kochetygova, a meeting for the bank's shareholders approved on Wednesday a new share issue totaling 5% of the enlarged charter capital, to be purchased by the IFC for $184 million.

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