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Credit Bank of Moscow obtains subordinated loan from EBRD.

10.08.2006

10 August 2006 - Credit Bank of Moscow ("CBM") and European Bank for Reconstruction and Development ("EBRD") signed US$20 million subordinated loan agreement.

This is the first transaction under EBRD's US$150 million financing program aimed to enhance capitalization of Russian banks approved in July this year.

The loan has 7 year maturity and is extendible by 2 years.

Subject to the Central Bank of Russia's authorization, the subordinated loan will bring Credit Bank of Moscow's (CBM) capital base to over US$160 million as of August 2006 (under USGAAP), further strengthening the bank's capital adequacy ratio to up to 24% of the weighted assets, and helping the bank to maintain its strong asset growth.

The proceeds will be primarily applied to boost CBM's geographical expansion, which encompasses a rapid deployment of the bank's outlet network. It is planned to increase the number of branches and mini-branches of CBM in the City of Moscow and the Moscow Region to up to 100 within the next two years.

Cooperation between CBM and EBRD began in May 2005 when CBM joined Trade Facilitation Program (TFP), under which CBM obtained a credit facility for financing foreign trade operations. In addition to the TFP credit facility, in June 2005 EBRD granted a US$10 million 5-year SME loan. The subordinated loan is the third credit facility provided by EBRD to CBM and signifies a higher level of trust of the reputable international financial institution in CBM's ability to continue successful business development.