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Promsvyazbank, Russian Agricultural Bank eye funding from Russia's budget


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Promsvyazbank, Russian Agricultural Bank eye funding from Russia's budget

PAO Promsvyazbank and JSC Russian Agricultural Bank could each get 5 billion Russian rubles from Russia's budget in 2018, Vedomosti reported May 11, citing draft amendments to the budget prepared by the finance ministry.

Funds for Promsvyazbank will be allocated to ensure lending to defense-sector companies, the news report said. The lender, bailed out by the Russian central bank in December 2017, was chosen by the government to specialize in servicing defense-sector firms in order to shield other banks from potential sanctions. Promsvyazbank was recapitalized for 113.4 billion rubles as part of its bailout and could receive additional support worth 130 billion rubles, Vedomosti noted.

Meanwhile, a capital boost for Russian Agricultural Bank is needed to maintain growth rates in the agricultural sector and to stabilize the bank's work, the news report said. In 2017, Russian Agricultural Bank received 50 billion rubles from the state, and originally there were no funds earmarked for the lender's support in 2018 under the current version of the budget.

As of May 11, US$1 was equivalent to 61.81 Russian rubles.