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Uncovered loans have usurped the capital markets as the funding tool of choice for large CIS exporters.

While most will take advantage of any form of debt on offer – bonds, ECA-backed facilities and bilateral loans – the large unbacked syndicate is currently most popular among Russian and CIS-based companies.

Head of treasury at Sibur, the petrochemicals company, Pavel Ananienko told the audience at the Russian trade and export finance conference in Moscow – among which was GTR – that the preference for certain forms of finance tends to be cyclical. While unco-ordinated, companies tend to act in unison.

He said: “The uncovered bank market is the best source of funding for Russian corporates. We have access to both Russian and overseas markets… we have access to all the financing in the world. Large Russian companies have a tendency to copy and follow each other’s actions. They came together to the bond market and to the ECA market. This year, it’s international banks.”

It marks a quite dramatic shift in pattern. At the same event last year, speakers warned trade finance bankers that loans were priced too highly to be considered a viable alternative to the bond market.

In 2011 and 2012, the bond market was used more frequently at the expense of bank lending and trade finance instruments. But the liquidity of international banks, coupled with the desire to lend to strong Russian companies, has seen the loan market usurp it.

The sentiment was echoed by speakers from Metalloinvest and Tatneft (combined the three companies account for 10% of Russia’s GDP).

The past year has seen a number of large Russian exporters hit the international loans market for the first time. In December 2013, the fertiliser producer Uralchem secured a five-year US$200mn syndicated loan priced at three-month Euribor plus 2.5%.

The company’s CEO Dmitry Konyaev remarked that “the terms of the new deal and the efficiency of its closing show the high confidence that the banks have in the group and the sustainability of its financial position”.

Earlier in the year, the company had also raised its first pre-export finance deal, worth US$220mn.

The Ukrainian arm of Metalloinvest, Metinvest, signed a number of similarly-large facilities over the past 12 months, raised on the international markets on an unsecured basis.

Just before the turn of the year, it opened a five-year unsecured PXF with Natixis, ING, Deutsche Bank and Raiffesen. In March, it raised a US$550mn facility with the same banks.

However, for smaller Russian companies, accessing bank loans and trade finance tools has been trickier.

Danila Kotlyarov, finance director for iron ore producer Russia Petropavlovsk told the conference that the midcap company has been unable to draw interest from the banking market, depending instead on Chinese ECA Sinosure for its funding. He called for the state-owned banks, VTB and Sberbank, to up their support for tier two companies.

There is also an educational requirement among smaller Russian companies, which have less understanding of trade finance instruments and their place in the funding portfolio.

Tatiana Chalachnikova, the head of Raiffeisen’s trade finance documentary business, agreed that banks need to be more flexible. However, she countered Kotlyarov’s claims by saying that standard trade finance tools are available to smaller businesses, but that they lack the awareness to make use of them.