Concern expressed by Yuri Bardin of aerospace agency(285 words)

Published: 12/5/2000

285 words In a substantial change of policy it appears that the terms of the leasing deals for a number of Il-96-300s and Tu-204/214s ordered by Aeroflot and Transaero may worse than expected with the announcement that the two banks involved in the funding of the leases finance Sberbank and Vneshtorgbank through Ilyushin Finance have changed the structure of their lending. The deals involving the financing of leases for six passenger Il-96-300 and one freighter, the latter currently parked at Shermetyervo awaiting conversion, for Aeroflot and ten Tu-204 and Tu-214s for Transaero are to be funded in rubles over five years at a rate of 24%, according to Alex Rubtsov of Ilyushin Finance. Changing the previous practise of heavy state guarantees and hard currency loans over periods of eight years at an interest rate of 12% to a level consistent with Russian market. The reaction of those involved to the changes have ranged from Yuri Bardin of the Russian Aerospace Agency, claiming that the terms of the financing mark the end of leasing of large Russian passenger jets, to the more reserved view of Ilyushin Finance's Alexander Rubtsov who according to reports, awaits a government meeting on the matter on the 7th of December. Ilyushin's funding requirements are reported to be $350m for all the aircraft currently scheduled. It is unclear however, why the terms have been changed at this point. Although the suspicion is that the Russian banks seeing the sovereign guarantees on the funding of the American proportion of the Il-96T/M would like to a similar deal from the Russian side and this is an opening gambit by the two state owned banks for generally improved terms on what is seen as a risky committement.

Article ID: 2228