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Presented by: VTB Bank, Custody

July 25, 2019 Issue No. 2019/27

Company News

InterRAO board of directors approves sale of Ekibastuz GRES-2 stake On July 19, 2019 the board of directors of Russian power holding Inter RAO approved the sale of a stake in the Ekibastuz GRES-2 power plant in Kazakhstan. In April, Inter RAO CEO Boris Kovalchuk said that the stake would be sold to an undisclosed buyer, and the deal would be closed until the end of 2019. Inter RAO and Kazakhstan’s Samruk-Energo each hold 50% stakes in the Ekibastuz GRES-2.

Ananyevs’ company sues Promsvyaz Capital for RUB 23 bln On July 22, 2019 it was reported that Promsvyazkapital, a company affiliated with former shareholders of Promsvyazbank, the Ananyev brothers, sent RUB 23 bln lawsuit against Netherlands-based Promsvyaz Capital B.V., through which they earlier controlled Promsvyazbank. The claim proceedings have not started. The government is creating a bank to handle defense order contracts in the conditions of Western sanctions on the basis of Promsvyazbank, which was bailed out by the central bank from December 2017 through May 2018.

Russia’s VTB Bank places RUB 22.6 bln worth of 1-day bonds On July 24, 2019 ’s second largest bank VTB placed RUB 22.6 bln worth of 1-day exchange bonds out of RUB 75 bln offer on the Exchange. VTB offered the bonds at 99.9813%, which corresponds to a 6.83% annual yield to maturity. Banks struck 387 deals during the auction. The bank placed its debut RUB 3 bln issue of the bonds on October 24, 2016.

Court arrests ex-executives of Otkritie FC Bank assets in RUB 290 bln case On July 24, 2019 the Moscow Arbitration Court arrested assets of former executives of Otkritie Financial Corporation (FC) Bank in RUB 289.5 bln case against them by the bank. Yevgeny Dankevich, former CEO, Ruben Aganbegyan, former president, founder Vadim Belyayev, former members of the executive board Yelena Budnik and Gennady Zhuzhlev, and the former key owner holding Otkritie were listed as co- defendants. The case is the record one over losses of a bank against the former shareholders in Russia. Earlier in July, the central bank said that its board of directors had decided to end the bailout of Otkritie FC Bank, and that the regulator's stake in the bank would be partially sold in 2021.

Subsidiaries to offer 2.9% shares of Gazprom on on July 25, 2019 On July 25, 2019 two subsidiaries of Russian gas giant Gazprom plan to offer 693.6 mln shares of the parent company, accounting for 2.9% of its charter capital, on the Moscow Exchange. Gazprom Gerosgaz Holdings BV and Rosingaz Limited, registered in the Netherlands and Cyprus, respectively, will collect bids for the entire package from 10 a.m. to 17 p.m. Moscow time. Gazprombank will organize the offering.

Dividends/coupons Severstal may pay RUB 26.72 per share in dividends for April–June 2019 On July 18, 2019 the board of directors of Russian steelmaker Severstal recommended paying RUB 26.72 per share, or a total of around RUB 22.384 bln, in dividends for April–June. The shareholders will consider the recommendation at an extraordinary general meeting on September 6. The register will be closed on August 12. The record date is September 17. The company paid RUB 45.94 per share in dividends for April– June 2018. Severstal’s key beneficiary is Alexei Mordashov, with 77.02% shares.

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Russian National Reinsurance Company pays RUB 450 mln in dividends for 2018 On July 19, 2019 it was reported that Russian National Reinsurance Company paid RUB 447.3 mln to the central bank in dividends for 2018. The net profit amounted to RUB 1.8 bln in 2018, as calculated under International Financial Reporting Standards (IFRS), surging from RUB 89 mln in 2017.

Executive says Severstal to borrow in July–December 2019 to pay dividends On July 19, 2019 Alexei Kulichenko, Deputy CEO for finance and economy at Russian steel producer Severstal, said that the company plans to borrow in July–December in order to pay dividends. Severstal pays dividends quarterly: 100% of the free cash flow if the debt/EBITDA (earnings before interest, taxes, depreciation and amortization) ratio is no higher than 1, 50% of free cash flow if the ratio is higher than 1, and more than 100% of free cash flow if debt/EBITDA is lower than 0.5.

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.

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