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Presented by: VTB Bank, Custody

September 3, 2020 Issue No. 2020/34

Internal Custody News

New version of General Terms and Conditions for Custody Business of VTB Bank (PJSC) Please note that from September 10, 2020 a new version of the Custody terms and conditions of VTB Bank (PJSC) will be put into effect (hereinafter - the Terms). The following changes and additions, in particular, have been introduced in the Terms: - operational procedures for custody account of escrow agent and Escrow agreement, - corporate actions with fractional securities, - telex as a communications channel would not be available for exchange of documents, it is not possible to exchange documents via TELEX.

The full Russian version of the updated General Terms is available at VTB Bank web-site via link https://www.vtb.ru/krupnyj-biznes/depozitarij/#tab_1_1#

Market News

Foreign share sales on SPB Exchange grow 2.6% in August 2020 to USD 15.2 bln On September 2, 2020 it was reported that foreign share sales on the Saint-Petersburg Exchange (SPB Exchange) grew 2.6% in August to USD 15.2 bln. The average amount of main trade rose 7% in August to USD 723.57 mln. The number of deals rose 17% to 15.85 mln. Deals with 1,363 foreign companies were struck in August. Tesla, Apple Amazon, Boeing, Carnival Corporation, American Airlines, Microsoft, Facebook, Advanced Micro Devices and Intel were the leaders by volume.

Company News

Rosneft buys back USD 800,000 securities on August 24–28, 2020 On September 1, 2020 it was reported that Russian oil major bought back 160,000 shares and global depositary receipts (GDRs) for USD 800,000 on August 24–28. The company bought 41,000 common shares and 119,000 GDRs. The weighted average price stood at USD 5.17 apiece. Since the launch of USD 2 bln buyback program on March 23, the company bought back 45.155 mln securities for USD 197.9 mln.

Sistema, RCIF sell all shares in for RUB 20.7 bln On September 2, 2020 it was announced that Russian multi-industry holding and the –China Investment Fund (RCIF) were selling all their shares in children goods retailer Detsky Mir at a price of RUB 112 per share. The size of the offer amounts to 184,750,001 existing shares of Detsky Mir, which corresponds to 25% plus one share of the company’s capital, which represents the entire stake belonging to the selling shareholders. After the deal, Sistema and RCIF will completely cease their ownership in Detsky Mir and will receive a total of RUB 20.692 bln for the stake. Sistema will get RUB 16.871 bln and RCIF will receive RUB 3.821 bln. The deal will allow Detsky Mir to become the first Russian company with 100% shares in free float. The Russian Direct Investment Fund’s (RDIF) CEO Kirill Dmitriev said that over 55% of the bidding book for Detsky Mir’s shares was signed by leading international funds from Europe, the U.S., and Asia.

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MTS buys back 0.0109% of capital under repurchase plan On September 2, 2020 it was stated that Bastion, a wholly-owned subsidiary of major Russian mobile operator MTS, acquired 217,800 MTS shares, representing 0.0109% of the operator’s share capital. The shares were acquired under a repurchase plan announced on March 31, and since then Bastion has acquired 12.837 mln MTS ordinary shares, including 3.365 mln shares bought back from the operator’s main owner, multi-industry holding Sistema for RUB 1.074 bln. In total, the purchased shares account for 0.642% of the capital. Under the Russian law, MTS must disclose any shares acquired by the company or by any of its subsidiaries.

Sistema fully draws MTS stake used as collateral for Sberbank loan On September 2, 2020 it was reported that Russian multi-industry holding Sistema signed an agreement with Sberbank, the country’s top lender, to release the holding’s stake in mobile operator MTS from pledge fully. Sistema borrowed RUB 60 bln loan maturing in 2023 and secured it against a 16% stake in MTS in February 2018. In November 2019, Sistema signed an agreement to extend maturity of the loan to 2025. The outstanding loan amounts to RUB 37.9 bln. Sistema’s effective ownership of MTS is 50.02%.

VimpelCom fully buys fixed-line operator West Call Ltd On September 3, 2020 it was announced that mobile operator VimpelCom, working under brand Beeline, has acquired 100% of West Call Ltd., one of the leading independent operators in Moscow, providing a broad range of fixed-line services under brand WestCall. The amount of the deal was not disclosed. The deal will strengthen positions of VimpelCom on the highly competitive broadband market of Moscow.

Sistema posts adjusted IFRS net profit of RUB 1.9 bln in April–June 2020 On September 3, 2020 it was reported that Russian multi-industry holding Sistema posted an adjusted net profit of RUB 1.9 bln in April–June, as calculated under International Financial Reporting Standards (IFRS). Revenue fell 0.5% to RUB 155.124 bln. Adjusted operating income before depreciation and amortization (OIBDA) decreased 0.6% to RUB 54.843 bln. Capital expenditures went down 5.1% to RUB 26.8 bln.

Dividends/coupons RusHydro still plans to pay dividends for 2019 at 3-year average On August 27, 2020 it was announced that Russian hydropower giant RusHydro still planned to pay dividends for 2019 that were no lower than the average figure for the previous three years. In March, the company said in a presentation that it expects dividends for 2019 to stand at RUB 0.0362 per share, or a total of RUB 15.7 bln. For 2018, RusHydro paid 3.67 kopecks per share, or about RUB 15.9 bln, which was 39.5% more than for 2017. First Deputy CEO Andrei Kazachenkov said that RusHydro expected that its financial results for 2020 would be solid enough to pay the better level of dividends for 2021. As of June 30, the Russian government owned 61.7% in RusHydro, VTB Bank had a 13% stake, LLC Avitrans had 5.8%, and other shareholders, including companies of RusHydro Group, owned 19.5%.

PIK Group board recommends paying RUB 15 bln in dividends On August 27, 2020 the board of directors of Russian real estate developer PIK Group recommended leaving the 2019 net profit undistributed, while paying RUB 22.71 per share, or almost RUB 15 bln, in dividends using profits of previous years and net profit for January–June 2020. The shareholders will consider the recommendation at an annual general meeting on September 30.

GV Gold board recommends RUB 54.56 per share in January–June 2020 dividends On August 27, 2020 the board of directors of Russian gold producer GV Gold recommended paying RUB 54.56 per share in dividends for January–June. The record date is October 15.

PhosAgro’s board recommends RUB 33 per share in interim dividends On August 28, 2020 the board of directors of Russian fertilizer producer PhosAgro recommended paying RUB 33 per share or RUB 11 per global depositary receipt, or a total of RUB 4.2735 bln, in interim dividends. The shareholders are to discuss the recommendation at an extraordinary general meeting on September 30. The record date for the dividends is October 15. The company also said that the board of directors praised CEO Andrei Guryev for his work in the company. Previously, the company paid RUB 78 per share, or a total of RUB 10.101 bln, in dividends for January–March, and RUB 18 per share, or a total of RUB 2.331 bln, in final dividends for 2019. Former Senator Andrei Guryev and members of his family hold 48.52% in PhosAgro, Vladimir Litvinenko owns 20.98%, and free-float is 30.5%.

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Europlan may pay RUB 1.8 bln in dividends for January–June 2020 On August 28, 2020 the board of directors of Russian car leasing company Europlan recommended paying RUB 15 per share, or a total of RUB 1.8 bln, in dividends for January–June. The company will pay RUB 1.703 bln from the net profit for January–June and RUB 96 mln from the undisbursed profit for 2019. Safmar Financial Investments owns 100% in Europlan.

Lukoil board to consider January–June 2020 dividends in October 2020 On August 28, 2020 Pavel Zhdanov, Vice President of Russian oil major , stated that the company’s board of directors would make a decision on dividends for January–June in October, their target level is RUB 46 per share.

LSR Group board recommends paying RUB 2.1 bln in January–June 2020 dividends On August 28, 2020 the board of directors of Russian real estate developer LSR Group recommended paying RUB 20 per share, or RUB 2.1 bln, in dividends for January–June. The shareholders will consider the recommendation at an extraordinary general meeting on September 30. The company’s net profit rose 50% on the year to RUB 2.6 bln in January–June, as calculated under International Financial Reporting Standards (IFRS). For 2019, the company paid RUB 30 per share, or a total of RUB 3.1 bln, in dividends. Andrei Molchanov is the major shareholder of the company.

Zarubezhneft to pay RUB 6.65 bln in dividends for 2019 On August 31, 2020 it was reported that Russian state-owned oil company Zarubezhneft would pay RUB 6.65 bln in dividends for 2019. The company’s net profit grew 16% to RUB 13.5 bln in the period, as calculated under International Financial Reporting Standards (IFRS). For 2018, the company paid RUB 5.9 bln in dividends.

Severstal owners approve paying RUB 15.44 per share in April–June 2020 dividends On August 31, 2020 shareholders of Russian steelmaker approved paying RUB 15.44 per share, or a total of around RUB 12.93 bln, in dividends for April–June. The record date is September 8. Severstal paid RUB 26.72 per share, or RUB 22.384 bln, in dividends for April–June 2019. In 2020, the company already paid RUB 27.35 per share, or a total of around RUB 22.91 bln, in dividends for January–March. The core owner of Severstal is tycoon Alexei Mordashov with a stake of 77.03%.

Russian Aquaculture to pay RUB 5 per share in dividends for January–June 2020 On August 31, 2020 shareholders of fish producer Russian Aquaculture approved paying RUB 5 per share, or a total of RUB 439.4 mln in dividends for January–June, for the first time since 2008 when the company was called Russian Sea Group. The record date for the dividends is September 11. Maxim Vodobyov, the brother of the Moscow Region’s governor, owns 48% in Russian Aquaculture.

Uralkali board recommends paying no dividends for 2019 On September 1, 2020 the board of directors of Russian fertilizer producer Uralkali recommended paying no dividends for 2019. The shareholders will consider the recommendation at an annual general meeting on September 30. The register for the meeting will be closed on September 6. Uralkali has not paid dividends on common shares since 2014. For 2017 and 2018, the company paid dividends on preferred shares in the amount of RUB 0.1 per share. UralChem of Dmitry Mazepin holds 46.37% in Uralkali, while Rinsoco Trading of Dmitry Lobyak has 53.63%.

Globaltrans board approves RUB 8.3 bln in January–June 2020 dividends On September 1, 2020 the board of directors of Russian rail freight carrier Globaltrans approved interim and special dividends for January–June in the amount of RUB 8.3 bln, or RUB 46.55 per share or global depositary receipt (GDR). The company also said it expects to pay around RUB 13.3 bln in dividends for entire 2020, including around RUB 5 bln in dividends for July–December.

Eurobonds / DRs Globaltrans eyes secondary listing of GDRs on MoEx in July–December 2020 On September 1, 2020 it was reported that Russian rail cargo operator Globaltrans plans a secondary listing of global depositary receipts (GDRs) on the in the second half of 2020.

TransContainer board approves GDR listing in London, Moscow On September 1, 2020 the board of directors of Russian railway container operator TransContainer approved a listing of global depositary receipts (GDRs) on the London Stock Exchange and the Moscow Exchange.

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Norilsk Nickel cuts Eurobond yield guidance to 2.7% On September 3, 2020 a financial source stated that Russian metals giant has lowered the yield guidance for 5-year dollar-denominated Eurobonds to around 2.7% from 2.875%. Demand for the Eurobonds exceeds USD 1.8 bln. On September 2, the company held a global call with investors devoted to the possible placement and a series of individual calls with investors. Citi, Societe Generale, UBS, BofA Securities, Gazprombank, Sberbank CIB, UniCredit, and VTB Capital will act as organizers.

Borets to offer at least USD 300 mln of 6-year Eurobonds On September 3, 2020 a financial source said that Russian oil service equipment producer Borets plans to offer 6-year Eurobonds for at least USD 300 mln. The company will hold a global investor call for a possible placement and a series of individual calls later on September 3. , Sberbank CIB, Barclays and Raiffeisen Bank International are the organizers. The company also plans to buy back Eurobonds maturing in 2022 for USD 330 mln.

Guidance for VEON’s 5-year Eurobonds set at 6.5–6.7% per year On September 3, 2020 a financial source stated that Amsterdam-based VEON, the sole owner of Russian mobile operator VimpelCom, has guided investors at a yield range of 6.5–6.7% annually for a 5-year Eurobond denominated in rubles. VEON is taking bids for the securities maturing in September 2025 on September 3. The holding company held a series of calls with investors on the bond placement on September 1. Citi, Sberbank CIB, and VTB Capital are organizing the deal.

Please be advised that the information presented in this newsletter is based on the following sources: National Settlement Depository (NSD); Clearstream Banking; Euroclear Bank; PRIME-TASS information agency; “Kommersant”, "Rossiyskaya Gazeta”, “Izvestiya, "Vedomosti”, “The Moscow Times“ newspapers, and others.

For more information kindly contact: Anna Enfiandzhiants Evgenia Makarov a Julia Dombrovskaya T +7 (495) 783 13 91 T +7 (495) 783 13 64 T +7 (495) 783 13 15 F +7 (495) 783 13 89 F +7 (495) 783 13 89 F +7 (495) 783 13 20 E [email protected] E [email protected] E [email protected] This document has been prepared exclusively for internal use of VTB Bank (PJSC) customers. The information should not be further distributed or duplicated in whole or in part by any means without the prior written consent of VTB Bank (PJSC). The information contained herein has been prepared on the basis of information which is either publicly available or obtained from a source which VTB Bank (PJSC) believes to be reliable at the time of publication. Information provided herein may be a summary or translation. The content of the material contained herein is subject to change without notice, and such changes could affect its validity. VTB Bank (PJSC) is not obligated to update the material in light of future events. Furthermore, VTB Bank (PJSC) does not warrant, expressly or implicitly, its veracity, accuracy or completeness. VTB Bank (PJSC) and its affiliates accept no liability whatsoever for any use of this communication or any action taken based on or arising from the material contained herein. Additional information may be available upon request. The material in this communication is for information purposes only. Therefore, this communication should not be interpreted as investment, tax or legal advice by VTB Bank (PJSC) or any of its officers, directors, employees or agents and customers should consult with appropriate professional advisers for these specific matters. Nothing expressed or implied herein is intended to create any obligation of VTB Bank (PJSC) and/or impose any liability on VTB Bank (PJSC) and/or create legal relations between VTB Bank (PJSC) and VTB Bank (PJSC) customers.

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