BRICS bank NDB thinking about ways to fulfill commitments to Russia, exec says

The New Development Bank, the multilateral bank set up by the BRICS states, is trying to think about ways it can fulfil its obligations to founding member Russia after it had to stop funding projects there to comply with sanctions, an executive said. In March last year, days after Russia invaded Ukraine, the NDB announced it would stop funding new projects in Russia to assure investors it was complying with western-led sanctions against Moscow.

The New Development Bank, the multilateral bank set up by the BRICS states, is trying to think about ways it can fulfil its obligations to founding member Russia after it had to stop funding projects there to comply with sanctions, an executive said.

In March last year, days after Russia invaded Ukraine, the NDB announced it would stop funding new projects in Russia to assure investors it was complying with western-led sanctions against Moscow. It also scrambled to win confidence from investors worried about its shareholding structure. But the bank still has obligations to founding member Russia, which has continued to make payments to the NDB throughout the crisis, Vladimir Kazbekov, an NDB vice-president and chief operating officer, said on Tuesday.

"Russia plays a significant role in the decision making process and given its special role as a founding member...NDB intends to think about fulfilling its obligations vis-a-vis, in compliance with applicable restrictions introduced on financial capital," he told a press conference held in conjuction with the bank's eighth annual meeting in Shanghai. The bank still would not fund new projects, but was looking at its old projects in Russia, he added.

It had a total outstanding exposure of $1.7 billion to Russian-domiciled entities as of the end of March last year, and exposure to Russian-domiciled entities represents less than 6.7% of NDB’s total assets, according to an investor presentation.

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