Ministry of Finance of the Russian Federation
Ministry of Finance of the Russian Federation
16.03.2004

PRESS RELEASE Russian Ministry of Finance Announces Closing of Exchange Offer and IIB Exchange

 

Moscow, 16 March 2004. The Ministry of Finance of the Russian Federation announced today the closing of its offer to exchange Russian Federation Eurobonds due 2006 to 2010 (2010 Bonds) and Russian Federation Eurobonds due 2007 to 2030 (2030 Bonds) for a portion of the former USSR debt owed by The Bank for Foreign Economic Affairs of the USSR (Vnesheconombank) to the International Bank for Economic Co-operation (IBEC) and the International Investment Bank (IIB). The Ministry of Finance also confirmed the closing today of the simultaneous offers made by IBEC and IIB to exchange a portion of Vnesheconombank’s debt to IBEC and IIB for a like principal amount of IBEC and IIB debt held by IBEC and IIB’s foreign creditors. The Vnesheconombank debt received by IBEC and IIB’s foreign creditors pursuant to IBEC and IIB’s exchange offer was automatically exchanged for 2030 Bonds and 2010 Bonds pursuant to the Russian Federation’s exchange offer. The exchange offers were launched on 25 February 2004 and expired on 5 March 2004.

U.S. $54.1 million principal amount of 2010 Bonds and U.S. $354.7 million principal amount of 2030 Bonds were issued at closing in exchange for approximately U.S. $426.6 million principal amount of tendered IBEC and IIB debt, valued at current exchange rates. The IBEC and IIB debt tendered in the exchange represented 100 per cent of the debt eligible to participate in the exchange offer. Participating foreign creditors of IBEC and IIB will also receive $31.8 million and $28.4 million in cash, respectively, in connection with the exchange.

The Ministry of Finance of the Russian Federation also announced today the closing of its exchange of 2030 Bonds and 2010 Bonds for all the remaining former USSR debt owed by Vnesheconombank to IIB. Based on current exchange rates, approximately U.S. $479.1 million principal amount of Vnesheconombank debt was exchanged for approximately U.S. $64.3 million principal amount of 2010 Bonds and approximately U.S. $426.8 million principal amount of 2030 Bonds. IIB will also receive $47.2 million in cash in connection with the exchange.

As a result of these exchanges, U.S. $905.7 million of principal claims on Vnesheconombank have been extinguished in exchange for U.S. $118.3 million of 2010 Bonds and U.S. $781.5 million of 2030 Bonds. U.S. $138.3 million of IBEC principal claims on Vnesheconombank remain outstanding, and it is anticipated that these claims will be subject to a settlement on comparable terms.


NOT FOR RELEASE IN THE UNITED STATES. These materials are not an offer for sale of the securities in the United States. The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act of 1933, as amended. The Russian Federation does not intend to register the securities in the United States or to conduct a public offering of securities in the United States.