Russian bank VEB seeks $34 bn injection: report

Russian bank VEB seeks $34 bn injection: report

Moscow: Russian state bank VEB has asked the government for an additional 34 billion dollars to shore up its cash reserves, Vedomosti business daily reported on Wednesday.

The request was made in a letter from VEB chief executive Vladimir Dmitriyev to Prime Minister Vladimir Putin, who also chairs the VEB board, on 6 November, the paper said, citing two government sources who were not identified by name.

A decision on the request was expected by the end of this week, the paper said.

VEB is a state vehicle charged by the Kremlin with distributing a portion of the more than $200 billion rescue package approved by the Russian parliament earlier this autumn.

Vedomosti separately reported that industrial production in Russia would shrink by 2.4% next year, dropping to levels not seen since the 1998 Russian financial crisis.

It was expected however to pick up again in 2010 and would grown by more than two percent by 2011, the paper said, citing data from a recent forecast prepared by the economy ministry.

Separately, the unemployment level in Russia has risen to 6.1% and was expected to climb further, the daily Kommersant reported, quoting figures from the state statistics agency Rosstat.

Kommersant said another 800,000 people could lose their jobs this month, which would bring the number of jobless Russians to more than five million, new unemployed this month, pushing unemployment up to about 7%.