MIGA Supports Russia's Ailing Financial Sector in the Wake of Global Financial Crisis

MIGA Supports Russia's Ailing Financial Sector in the Wake of Global Financial Crisis
(Russian)

WASHINGTON, DC, December 2, 2008—The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance arm of the World Bank Group, said today it has issued a guarantee covering UniCredit Bank Austria AG’s $90.3 million shareholder loan to the Closed Joint Stock Company UniCredit Bank in Russia.  The guarantee will allow the UniCredit Group to finance its local subsidiary and is particularly important in view of the current turmoil in financial markets worldwide.  It will also help enable SMEs in the region to receive credit at a time when financing is scarce for business growth.

“No country is immune to the impacts of the global financial crisis,” said Shigeo Katsu, World Bank Vice President for Europe and Central Asia. “The guarantees issued by MIGA will help support the banking sector in Russia at a time when banks in emerging markets and transition economies are reeling from ebbing global liquidity and free-falling stock markets.”

MIGA’s support for the banking sector in Russia is consistent with the World Bank Group’s efforts to help countries strengthen their economies, bolster financial systems, maintain growth and protect the most vulnerable.  MIGA has supported several other guarantees in the Russian Federation in a wide range of sectors, including infrastructure, mining, manufacturing and financial sector.  In the financial sector, MIGA has supported various investments in leasing, banking and mortgage financing.

The agency’s guarantees help mitigate noncommercial risks to investments, encouraging lenders and investors to invest in emerging markets and transition economies and inject much-needed liquidity in these markets. 

“MIGA’s products and services are more critical than ever before at times like this to bolster confidence in the financial sector,” said James Bond, Acting Executive Vice President and Chief Operating Officer of MIGA. ” By providing guarantees to cover loans to banks, MIGA can help address the economic and financial vulnerabilities of these countries in the wake of the global crisis.”

Similar guarantees are expected from MIGA for projects in other Eastern European and other regions. To find out more about MIGA’s support for the financial sector, visit www.miga.org.

For information:
Mallory Saleson, msaleson@worldbank.org, 202.473.0844
Farah Hussain, fhussain@worldbank.org 202.473.2540