Center-invest Bank Increases Agribusiness Lending
In 2015 Center-invest Bank reduced its loan interest rates for agricultural companies. It has since seen its agribusiness loan portfolio reach RUB11bn. Russian companies that are producing alternatives to agricultural imports have received loans to finance the sowing season, other current needs, and investment projects.
Dr Vasily Vysokov, chairman of the Board of Directors of Center-invest Bank, presented these latest results when he addressed the plenary session of the International Agrarian Congress held during the XXII International Agricultural Exhibition YugAgro in Krasnodar.
Even before his speech, Dr Vysokov was approached by numerous delegates who were keen to thank Center-invest Bank for its cooperation. Customers said they were grateful that, unlike speculative banks, Center-invest Bank did not raise its interest rates on existing loans during the crisis. Instead, applying a sustainable banking business model, we worked together with our customers to develop risk reduction programmes for the crisis. This enabled us to keep loan interest rates low, meaning that customers could complete their existing projects and repay their loans on time and in full.
Over 60% of Center-invest Bank’s agribusiness loan portfolio comprises investment loans, which companies are using to modernise agricultural production and increase the level of processing.
“Many bankers are scared of lending to agriculture and prefer to work with oil and gas companies,” Dr Vysokov says. “But our country’s wealth lies not just in Siberian oil wells, but also in the soil in our fields. We work closely with analysts from international rating agencies, who believe that agribusiness is too risky. And we keep explaining to them that the best region in the world for agriculture is the strip of land from the Carpathian Mountains to the Caucasus Mountains. It is entirely natural that we are now seeing a flow of capital from the raw material sectors into southern Russia’s agricultural sector. New projects, however, must be based on best international practice and leading technologies. Center-invest Bank finances companies that are ready to expand and to make our agricultural sector more competitive in the global economy.”