Russian Development Bank To Restructure Sochi Olympic Loans

Russia's troubled state development bank, Vnesheconombank (VEB), says it will restructure more than 200 billion rubles ($3.1 billion) in loans tied to the 2014 Sochi Olympics.

VEB CEO Sergei Gorkov said on June 23 that the bank will extend the maturity of the loans by 25 years to help borrowers meet repayments.

Gorkov also said the lender's board had approved the sale of VEB's 3.6 percent stake in gas giant Gazprom.

VEB has been crippled by a funding shortfall after it was hit with sanctions following Russia's annexation of Crimea in March 2014.

The bank is to receive 150 billion rubles ($2.3 billion) from the state budget in 2016 to repay foreign debts.

Economy Minister Aleksei Ulyukayev said on June 23 the bank may need 260 billion rubles ($4 billion) from the budget next year.

The cost of its bailout could reach 1.2 trillion rubles ($19 billion), according to government officials.

Based on reporting by Reuters, TASS, and Bloomberg