The structure of borrowing by RAO UES of Russia in 1999 was determined by the need to service and clear loans acquired previously. Therefore virtually all loans taken out were used to refinance or restructure existing debt.
Due to an improvement in the general economic and financial situation in Russia in 1999, RAO UES of Russia was able to extend the periods of its loans (by 50 per cent) and significantly reduce its rates of borrowing (in some instance by as much as a half). Overall, in 1999, the loan indebtedness of RAO UES of Russia increased by 500 billion rubles. To a large extent, this was the result of the high proportion of hard currency borrowing in the Company’s portfolio and an increase in the dollar exchange rate from 20.65 rubles on 01.01.1999 to 27.00 rubles on 01.01.2000. In October 1999, the Board of Directors of RAO UES of Russia adopted a credit programme which imposes a ban on any increase in loan indebtedness and allows further borrowing solely and exclusively for the refinancing of existing debt.
In addition to taking out loans in the form of bank credits, in the period from December 1999 to February 2000 RAO UES of Russia carried out the placement of an issue of three-year ruble coupon bonds which raised 2,827 million rubles.
| Next Chapter | ||