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Rosselkhozbank fully placed the third bond issue worth RUR 10 billion

26 February 2007

On 22 February 2007, a full placement was made on the MICEX stock exchange of the third issue of documentary interest-bearing bonds payable to bearer issued by Rosselkhozbank and worth RUR 10 billion.

There were 77 bids submitted by the investors totalling RUR 16.11 billion with the proposed first coupon rate from 6.95% to 7.49% p.a., and most of the bids were within 7.30% to 7.40% p.a. According to the arranger's estimates, foreign investors purchased 90% of the bond issue.

The first coupon rate was set by the auction at placement and amounted to 7.34% p.a. (which is 36 roubles 60 kopeks per a bond); the rates of the second to sixth coupons were equal to the first coupon rate, the other coupon rates will be extra set by the Issuer.

Effective yield to a three-year offer was 7.48% p.a., that is lower than the yield bottom line estimated by the arranger before the placement. Such a success was underpinned by a favourable market environment, impressive membership of the syndication, high credit quality of Rosselkhozbank and heavy demand from foreign investors.

As a result of the auction, 48 bids were accepted.

The issue was fully placed on the commencement day, with 197,750 securities being placed in the evening session.

VTB is an arranger and an underwriter of the issue.

Citigroup was appointed a strategic partner and a co-arranger.

Other co-arrangers of the placement were Moscow International Bank, Credit Suisse, Depfa Investment Bank, ABSOLUT BANK, Dresdner Bank, Investsberbank, ING Bank, Raiffeisenbank Austria, Sberbank of Russia, and Bank Souyz.

Co-underwriters of the issue were Deutsche Bank, ABN AMRO bank, Evrofinance Mosnarbank, Rosbank, Standard Bank, and Uralsib.

Rosselkhozbank was assigned long-term investment ratings from Moody`s/Fitch at Ваа2/BBB+ similar to the level of VTB and Sberbank.

The volume of Rosselkhozbank bond issue is RUR 10 billion at par (State Registration Number is 40303349В of 26 January 2007). The issue matures in 3 640 days (10 years) and will have semi-annual coupon payment. The rates of the first to sixth coupons are 7.34% p.a., other coupon rates will be extra set by the Issuer.

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