Russian bank VTB says it was deceived by Mozambique over loans

Login

Register

http://www.clubofmozambique.com/

Russian bank VTB says it was deceived by Mozambique over loans

2:13 CAT | 14 Oct 2016

Yuri Soloviev in a file photo

“The government deceived us” by not disclosing the debts with state guarantee contracted by various public companies in 2012 and 2014, said the vice president of Russia’s VTB bank about the loan to Mozambique.

In an interview with Bloomberg news agency, Yuri Soloviev, head of VTB Capital and first deputy chief executive officer of VTB Group, said the institution had been deceived because the state-guaranteed debts of several public companies were not disclosed to investors and the International Monetary Fund (IMF) by the government of Mozambique.

Soloviev said that VTB was no longer the holder of the debt, but that it had not abandoned investors “since we are responsible, as agents of the loans and in the issuance of foreign-currency debt “.

Referring to public debt amounting to US$727 million (EUR658 million) that the Government of Mozambique took on at the beginning of this year, the deputy CEO of Russia’s second largest bank said: “We are being patient and trying to resolve the situation.”

VTB and Credit Suisse both helped restructure the Mozambican debt, but the operation was kept undisclosed by the Mozambique government until April 2016, when the Minister of Economy and Finance acknowledged the debt druing the IMF Spring Meetings in Washington.

The IMF, the World Bank and several countries then suspended the financing of projects in Mozambique, giving rise to the current economic and financial crisis.