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The first ever subordinated Eurobond issued under the Bank of Russia’s new Basel 3 based requirements has been included in CREDIT BANK OF MOSCOW’s capital

27.05.2013

27 May 2013 – On 23 May 2013, CREDIT BANK OF MOSCOW (the “Bank”) received the final conclusion from the Bank of Russia approving the USD 500 million subordinated loan received by the Bank in connection with the USD 500 million 8.7% Loan Participation Notes due 13 November 2018 issued by CBOM Finance p.l.c. (the “Notes”) as a subordinated loan eligible for inclusion into the Bank’s own funds (capital) as Tier 2 capital.

As a result of the approval, pursuant to the Bank of Russia’s Regulation No. 215-P “On the Method of Calculation of the Net Worth Capital of Credit Organisations”, the Bank’s Tier 2 capital increased by RUB 9.0 bln due to the restrictions on inclusion in additional capital of an amount exceeding 50% of a bank’s core capital. At the same time, under the Bank of Russia’s Regulation №395-P dated 28.12.2012 “On the Method of Calculating the Amount, and Assessing the Adequacy of, the Capital of Credit Institutions (“Basel 3”)”, the Bank’s Tier 2 capital increased by the amount of the entire subordinated loan proceeds equivalent to RUB 15.7 bln.

The Notes were issued on 13 May 2013. HSBC, Raiffeisen Bank International and The Royal Bank of Scotland acted as joint lead managers and bookrunners, HSBC also being the sole structuring adviser. The transaction represents the first subordinated Eurobond issued by a Russian bank, the proceeds of which have qualified as regulatory capital under Regulation No. 395-P.

Background details

CREDIT BANK OF MOSCOW was founded in 1992. It holds general license No. 1978 issued by the Bank of Russia. As at end-2012, the Bank ranked 19th largest bank in Russia in terms of total assets under RAS (RBC Rating).

CREDIT BANK OF MOSCOW is a universal commercial bank providing the full range of banking services. The Bank focuses on Moscow and the Moscow Region. The Bank has been covered by the Russian Deposit Insurance System since 2004.

85% of the shares in CREDIT BANK OF MOSCOW are held by “ROSSIUM Concern”, LLC, whose stake is beneficially owned by Mr. Roman Ivanovich Avdeev.

7.5% of the shares are held by the European Bank for Reconstruction and Development, 2.9% by International Finance Corporation (IFC) and 4.6% by RBOF Holding Company I, Ltd. (100% owned by IFC Russian Bank Capitalization Fund belonging to the same group of companies as IFC). The Bank is rated B1/B+/BB- (M/S&P/F).

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