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Deutsche Bank has successfully arranged the first ever 12-year Russian rouble export financing for the Russian Province Samara (Samara Oblast) with a transaction volume of Rb1.13bn (US$41mn).


The financing supports the export of high-tech medical equipment from New York-based ACD Research Inc. to the Samara Oncology Center, located about 600 miles southeast of Moscow. The medical equipment will enable Samara’s Oncology Center to begin cancer treatment in a region that is home to 13% of Russia’s population. Construction of the 550-bed oncology centre was completed in 2004.


Deutsche Bank acted as advisor to Samara Oblast, enabling it to access a highly structured, long-term rouble financing via its US supplier, ACD Research. The US government, through its Overseas Private Investment Corporation (Opic), provided political risk insurance on the transaction.


“This transaction represents a significant breakthrough in sub-sovereign and local-currency export finance that leading trade banks have been attempting to address for years. Deutsche Bank’s trade and export finance teams in New York and Frankfurt executed the transaction, leveraging their strengths in arranging structured export finance secured through insurance and other forms of collateral for clients in challenging credit markets,” says Klaus Michalak, global head of structured trade and export finance.


Stephen Atallah, US head of structured trade and export finance, adds: “The foreign exchange and devaluation risks are fully managed and covered in the structure, which permits export financing in virtually any freely convertible local currency as well as for a broad group of new and yet untapped sub-sovereign borrowers. Local currency finance is often critical for such borrowers that cannot legally or easily borrow in foreign currencies, as is the case throughout Russia and many developing countries. The structure also offers the advantage of providing 100% financing solutions at longer than normal durations and at relatively low borrowing costs.”