Confusion reigns over Aeroflot's overseas banking

Published: 11/4/1999

It seems that the way to get a banking customer in Moscow these days is to lend them some money, or is it? Last month, Aeroflot received a loan of $14.5m from London-based Moscow Narodny Bank, which is 89% owned by the Russian Central Bank, according to Alexander Polyakov, Deputy Head of Mosnarbank Ltd (Moscow), part of the Moscow Narodny Bank. Polyakov said that, following the break, In February 1999, with the Swiss-based Andava and Forres entities, controlled by Boris Berezovsky, Moscow Narodny has been steadily gaining control of the 250 Aeroflot foreign accounts previously controlled by Andava, as the clearer of Aeroflot's foreign-generated revenue. This somewhat contradicts the news that Aeroflot has just announced Chase Manhattan Bank's appointment to service its foreign accounts, but is retaining Moscow Narodny Bank for its domestic banking business. The timing of the loan is interesting, given that it comes at a time when the airline is negotiating to reschedule its existing financial commitments in the form of leases. No details were released on the terms of the new loan. Aeroflot has never been known for a coherent approach to its financial management and given the confusion that emerges from these two reports as to who is managing its foreign accounts, it seems that this reputation continues to be justified.

Article ID: 1049