VEB agrees to issue loans to VTB, Russian Agricultural Bank

MOSCOW, October 23 (RIA Novosti) - Russia's state-run Vnesheconombank (VEB) announced on Thursday it had signed contracts with VTB and the Russian Agricultural Bank for loans of 200 billion rubles ($7.4 billion) and 25 billion rubles ($929 million), respectively.

Both loans will be issued with an 8% interest rate until 2019.

VTB, Russia's second-largest bank, will receive its loan in two tranches, while Rosselkhozbank has obtained its loan in full.

VTB asked the national development bank for aid in refinancing its $11.4 billion foreign debt in 2008-2009 last week.

"We have to pay off some $2.4 billion of foreign debts before the end of this year," VTB chief Andrei Kostin told reporters in Washington, adding that another $9 billion in foreign debt would have to be paid in 2009.

The Russian government has allocated the national development bank VEB $50 billion from its international reserves to refinance foreign debts of Russian companies and banks.

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