Independent Leasing Senior Loan

complete

The proposed project consists of a secured multicurrency loan to a leasing company Promsvyazleasing (PSL). The Loan can be convertible into up to 10% of the common stock equity. The Loan will finance leases made to local companies operating across a variety of industries. The main objective of the project is to support PSL’s further expansion by providing long-term debt facility, diversifying the Company’s funding base and assisting its efforts to develop its leasing portfolio in Russia. The transition impact potential of this project arises mainly from its support to the development of the Russian leasing sector and the subsequent increase in the financial sector intermediation which is still at a comparatively low level. In addition, the project will support a wider application of the internationally acceptable leasing practice in Russia and promote competition in the leasing sector. The Project is consistent with EBRD’s transition mission because it: improves the availability of leasing in Russia and particularly in the regions (the Company has a strong position in the regional markets, most prominently in the southern and Siberian regions; the new strategy envisages close cooperation with the affiliated company Oranta, which is present in most of the Russian regions); and improves access of financial leasing to SMEs in Russia by virtue of the Company’s new strategy to increase the number of smaller ticket leases. Promsvyazleasing limited is a leasing company headquartered in Moscow. PSL was established in 1999 to provide leasing finance in Russia. The company is currently 50% owned by Promsvyaz Capital group, and 50% by Russia Partners, a private equity fund operating in the Russian federation. As at the end of September 30, 2006 the company’s total assets were USD 77.4 million and net investment in leases of USD 32.2 million. Convertible loan for USD 30 million. USD 30 million. Promsvyazleasing is required to apply the EBRD’s Environmental Procedures for Leasing which include the Bank’s Environmental Exclusion and Referral List. Lessees are to comply, at a minimum, with national standards for environment, health, safety and worker protection and public consultation. Promsvyazleasing will assess potential environmental issues associated with individual transactions and will be required to provide the EBRD with an Annual Environmental Report. None. Sergey Kileinikov, CEO, Promsvyazleasing, Office: 415, 134B Vereyskaya Street Moscow 121357 Russia Tel: +7 495 745 4260 Fax: +7 495 644 2881