A signing ceremony took place on 10 November 2003 in Moscow where a Master co-operation agreement was entered into between Vneshtorgbank and AVTOVAZ, major Russian car maker, located in Togliatti, the Saratov Region. Mr. Andrey Kostin, President and C.E.O., for Vneshtorgbank, and Vitaly Vilchik, Director General, for AVTOVAZ, signed the agreement.
Last September, the Co-operation Programme was already signed between Vneshtorgbank and AVOVAZ to set forth specific lines of joint efforts, in particular, lending against promissory notes, as well as direct loans to finance the AVTOVAZ manufacturing programme, its long-term investment projects, insurance, and rouble-denominated bond issue, as well as ensuring AVTOVAZ`s access to external financing markets.
After the promissory note programme started, AVTOVAZ promissory notes totalled to 3.4 billion roubles were distributed.
With the participation of Vneshtorgbank as an arranger, an underwriter and a payment agent, the first AVTOVAZ bond distribution took place in February 2003. The second 3 billion rouble-denominated bond issuance is to be distributed in 2004. Vneshtorgbank as a market-maker is actively developing the secondary market for AVTOVAZ bonds.
In 2003, Vneshtorgbank granted credit lines to AVTOVAZ to pay deliveries of imported equipment with funding raised from foreign banks under coverage granted by export credit agencies.
The signing of the Master agreement is a further step forward in developing mutually beneficial partnership of the parties, which will foster market capitalisation of the factory and investment attractiveness of its securities instruments, successful implementation of its manufacturing programme and investment projects, improving the AVTOVAZ`s international and domestic payment system, implementing cutting edge technologies in financial asset management.