Russian Agricultural Bank assists the Russian Government in implementing federal policy in agribusiness.
RusAg plays a fundamental role in financing domestic agribusiness development. The Bank’s mission and strategy prioritize financing and fostering the development of agribusiness (including fishery and forestry enterprises), and individuals residing in mid-sized towns and rural areas.
RusAg is the key bank in implementing federal and regional agribusiness development programs. The Bank has cooperation agreements in place with regional authorities, SME financing funds and guarantee agencies in the territories where it is present to pursue regional development strategies and federal policies in economic, social, educational and other spheres.
Russian Agricultural Bank takes part in sustainability programs focused on the social aspects and initiated by the Government. The aims of these programs are to provide affordable financing to agribusinesses, to improve their financial performance so that more rural communities may benefit from them.
Financial Rehabilitation of Agribusiness Enterprises
Since 2002, Russian Agricultural Bank has been implementing the Government policy on the financial rehabilitation of agricultural producers.
Such measures are taken by the Bank with consideration of the need for business conservation while mitigating the negative impact on the Bank’s financial performance. Loan book to agricultural producers, participating in the financial rehabilitation program, totaled RUB 72.3 billion at YE2018.
Financing Government programs
Russian Agricultural Bank, for more than 14 years now, has participated in the government sustainability programs focused on social aspects.
RusAg prioritizes lending to the following key segments within the framework of the 2025 State Program:
Lending for various purposes, such as: machinery, livestock, grain, fuel, and fertilizers purchases, land, warehouses and facilities lease with priority given to agribusiness producers, farmers, agricultural consumer cooperatives, food processing companies, fisheries and aquaculture producers, markets and shopping facilities;
Financing seasonal field works. The Bank accounts for 71.6% of total seasonal field works financing, with RUB 326 billion in loans issued for this purpose in 2018;
Lending to agricultural credit and consumer cooperatives. This type of support contributes to closer cooperation and integration in rural areas. Credit and consumer cooperatives are an important vehicle for rural financial stability;
Support of export-oriented businesses. The Bank’s efforts in this area contributed to national foodstuffs and raw materials exports reaching USD 25.8 billion in 2018 (+25% year-on-year), including 288 thousand tonnes of meat (+21% y-o-y). For the season 2018/2019 (from July 2018 to June 2019) exports of grain reached 33.5 million.
Agribusiness subsidized lending programme (Government decree No. 1528) Under the agribusiness soft lending programme Russian Agricultural Bank lends at maximum 5% p.a. Subsidies are paid directly to banks, which gives farmers easier access to state support;
Financing investment projects for constructing and upgrading greenhouses, livestock and fish breeding facilities;
Developing all forms of small business, including family-operated farms and startups. Fostering agribusiness startups creates new jobs for young professionals and qualified personnel retention in rural areas.
The Bank is involved in implementing special purpose federal subprograms:
Sustainable development of rural areas
The program is aimed at upgrading living standards, stimulating investments in agribusiness, strengthening positive attitudes towards rural life and developing non-agricultural production and employment; promoting the creation of hi-tech employment opportunities. which is designed to increase living standards of rural residents; mobilize investments in agribusiness; promoting the creation of high tech jobs, stimulating the local communities engagement in socially important projects, creating positive attitude towards rural way of life.
State program for construction development
The program is aimed at support of residential construction for certain categories of citizens, support of solvent demand for housing, enhancing quality of utility services. As part of this program, Russian Agricultural Bank is involved in the sub-program ‘State subsidized mortgage lending’. The Bank provides mortgages to young families, families with children (under Federal Special Purpose Programs) and military servicemen (pursuant to Russian Federal Law No. 117-FZ “On the Mortgage Savings System for Housing Provisions for Military Servicemen”).
Lending stimulation for small and mid-sized businesses (6.5 Program)
The program is implemented in cooperation with the SME Development Corporation.
Russian Agricultural Bank is the key participant in the State Program for Agribusiness Development 2013-2025, including the mechanism of agribusiness subsidized lending, as the form of state support of the agribusiness sector, whereby:
New rules came into force starting January 1, 2017, regulating the provision of subsidized bank loans to agricultural producers and agribusinesses. This is a major update to the loan subsidization procedure, introducing in particular a cap on interest rate for subsidized loans, a simplified approval procedure for agricultural soft loans, and a share of small businesses in subsidies (at least 20%).
Rules that apply to loans issued starting 1.01.2017
Rules that apply to loans issued starting 1.01.2019
Rules that were applied to loans issued before 31.12.2016