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The signing of the MOU between the two banks is a follow-up measure to the ‘Korea-Russia Joint Committee on Economic, Scientific, and Technological Cooperation’ held in July in Seoul, where the two countries agreed to cooperate extensively to develop the Far East.

After signing the MOU with VEB Chairman Vladimir Dmitriev, Chairman Kim Yong-hwan remarked, “Today we have secured a firm foundation for providing diverse types of financing to Korean companies preparing to participate in large-scale development projects in Russia. Korea Eximbank will henceforward do its utmost to help Korean firms win new projects in Russia.”

Earlier on that day, Korea Eximbank also signed an MOU with Russia’s largest state-owned bank Sberbank to cooperate on providing up to USD 1.5 billion worth of financing for medium- and long-term projects in Russia and Central Asia.

The main thrust of the MOU is to increase the ceiling of Korea Eximbank’s credit line to Sberbank, or the Interbank Export Loan, from USD 700 million to USD 1.5 billion to facilitate the growing number of energy and natural resource-related projects where Korean companies participate.

The Interbank Export Loan is a type of credit line extended by Korea Eximbank to foreign banks, under which the latter can lend money borrowed from the former to local companies importing goods from Korea.

It in effect allows Korea Eximbank to use foreign banks as its overseas branches to promote Korean exports.

Korea Eximbank currently has such credit lines with six Russian banks, amounting to a total of USD 1.5 billion.

After signing the MOUN with Sberbank Vice Chairman Andrey Ivanov, Chairman Kim said, “Sberbank not only has the largest network in Russia but also has networks in 17 countries including Ukraine and Kazakhstan. I am confident that our MOU with Sberbank will serve to boost trade between Russian and Korean businesses.”

Korea Eximbank plans to offer as much medium- and long-term financing as possible to infrastructure and energy/resources-related projects in the Russian Far East and Siberia, as well as in Eurasia more broadly.

Chairman Kim also met with En+ Group President Oleg Deripaska at Korea Eximbank’s headquarters on November 12 and promised to offer plentiful financing for natural resource development or power plant projects in Russia undertaken jointly by En+ Group and Korean companies.