The 'A+' rating indicates that OJSC Credit Guarantee Agency is a highly reliable guarantee institution. The risk of a failure to meet obligations in time is insignificant.

OJSC Credit Guarantee Agency was established in 2003 by the Government of Leningrad region with the aim of creating favorable conditions  for access to credit facilities of banks and leasing companies.

We regard the high degree of financial independence (equity to total assets ratio), the robust guarantee coverage and the low loss ratio of CGA as the positive rating drivers for the guarantee institution.

The Agency's net asset value has stayed on the upward trend for years. For 9 months of 2014, CGA's net assets increased by 16.5% to RUB 329.4 million. This change is primarily attributable to the additional issue of securities for a total amount of RUB 46.6 million. At the end of the third quarter, CGA's equity to total assets ratio was fairly high (99.4%) due to a low share of accounts payable (0.3% of the total liabilities) and absence of borrowings.

The guarantee institution's free financial resources in the amount of RUB 295.4 million are deposited with three Russian banks and invested in municipal bonds with a fairly high aggregate annual yield rate. All the credit institutions CGA has deposited funds with are among the 100 leading Russian banks and rated 'A++' on the AK&M Rating Scale. It should be noted that the guarantee institution's maximum percentage of deposit(s) with one bank is 33.8%, meeting the regulatory authority's a deposit per banking institution requirement (34% for a guarantee capital of at least RUB 150 million).

Over the period of activity, the Agency has effected indemnity payments for a total amount of RUB 15 million under surety agreements with partner banks. CGA successfully recovered 27% of that amount from the borrowers through applicable recourse procedures. With a loss ratio of 1% as of November 14, 2014, CGA was on the 22nd position among the guarantee institutions ranked by AK&M RA based on the 6-month performance in 2014 (the loss ratio has seen almost no change since July 1, 2014).

The credit rating is constrained by the shrinking surety portfolio, lower revenues and return on assets.

Since the start of the year, CGA's current surety portfolio has decreased by 28.2% to RUB 215 million. This impairment reduced the guarantee institution's capital multiple from more than 100% to 65%.

The Fund's revenue decreased by 60.5% in 2014 strengthening the dominance of interest earnings from deposits and municipal bonds in its profits. Their share in total incomes increasing by 15 p.p. to 92% in 2014. Return on assets decreased by 1.8 p.p., although staying fairly high (5.3% year-on-year on an annualized basis as of the last reporting date).

Open Joint Stock Company Credit Guarantee Agency (CGA) was registered in September 2003. The Company's sole founder is the government of Leningrad region. Over the period of its existence, CGA concluded more than 514 guarantee and surety agreements for a total of more than RUB 1 billion, raising 2.3 rubles in SME-targeted external investments per each ruble of public investment. As of November 14, 2014, CGA's portfolio of surety commitments amounted to RUB 215 million, the funds raised reached RUB 2,453 million. OJSC Credit Guarantee Agency secured the 27th position in AK&M Rating Agency's H1 2014 Ranking of Regional Guarantee Institutions comprising 52 entities.

This press release is based on the Statement of assignment of a guarantee institution rating to OJSC Credit Guarantee Agency.

The rating, along with any information and conclusions provided in this press release, only conveys our creditworthiness opinion and shall not be construed as a recommendation to purchase or sell securities, or to lend funds.

AK&M Rating Agency shall not be held liable for any interpretations, inferences and consequences related to the application of results of the rating estimation procedure by any third parties.

CJSC Analysis, Consulting and Marketing Rating Agency is a leading independent national rating agency engaged in rating activities since 1993. CJSC AK&M Rating Agency is accredited by the Ministry of Finance of the Russian Federation (order no. 452 as of September 17, 2010) and is on the Central Bank of Russia's Register of Accredited Rating Agencies.

CJSC AK&M Rating Agency

Ul. Gubkina 3, Moscow, Russia

www.akmrating.ru

Phone no. (495) 916-70-30, fax no.: (499) 132-69-18.