JSC VTB Bank will receive about 330 billion Russian rubles in state guarantee payments on loans provided to companies participating in Russia's state armament program, Vedomosti reported Dec. 14, citing Mikhail Zadornov, the head of the lender's retail unit Bank VTB 24.

Russian authorities reportedly put in place a funding scheme in 2011 and 2012 under which state-owned VTB, PAO Sberbank of Russia, Vnesheconombank and AO Gazprombank provided state-guaranteed loans to companies participating in the program. Over 1 trillion rubles of loans were offered under the scheme, which ended in 2015, Vedomosti said. The government initially planned to pay back about 800 billion rubles of loans to the banks in 2017 and 2018, but it was later decided that the funds would be repaid by the end of 2016 in order to reduce pressure on future budgets and help the domestic defense industry, the news report said, citing Finance Minister Anton Siluanov.

Sberbank, the second largest creditor under the scheme after VTB, could receive around 300 billion rubles in repayments by the end of the year, according to Vedomosti. The value of loans provided by VEB under the program reportedly stood at 43.9 billion rubles at the end of 2015, but the lender's representative did not comment on the sum that could be repaid. The news report did not provide information regarding financing issued by Gazprombank.

VTB and Gazprombank could use funds from the repayments to pay back expensive funding from the Russian central bank and the finance ministry, Vedomosti said, citing Alexander Danilov, a senior director at Fitch Ratings in Moscow. Sberbank has a surplus of liquidity, so it could temporarily deposit the funds with the central bank, the analyst reportedly added.

As of Dec. 14, US$1 was equivalent to 61.19 Russian rubles.