Putin suggests subsidized loans for systemically important cos to top up working capital
MOSCOW. April 15 (Interfax) - Russian President Vladimir Putin has suggested that subsidized loans be introduced for systemically important enterprises to top up working capital.
"I also propose providing for a new special credit product - subsidized loans to top up working capital. This is money that companies need to buy raw materials, parts, to pay advances to suppliers," he said at a conference with cabinet ministers.
That sort of support will enable not just systemically important companies but also their partners to continue to operate rhythmically. "That is we will be supporting employment and issuance of wages to employees throughout the cooperative chain. The state will subsidize interest on such loans in the amount of the Bank of Russia's key rate. That is, the true cost of a loan for enterprises today will be 6 percentage points less than the current market rate," Putin said.
He also said half of a loan of this type would be backed by Finance Ministry guarantees "which will also give banks further incentives to issue such loans, minimizing risks for the banking system."