UPDATE 1-Russia's corporate foreign debt grows in Q2

MOSCOW, July 3 (Reuters) - The Russian corporate sector's foreign debt grew to $436.8 billion as of July 1 from $420.7 billion as of April 1, the central bank estimated on Friday, suggesting there has been renewed borrowing by Russian firms. Russian companies borrowed excessively from foreign lenders at the height of the oil boom but had to face painful restructuring talks when commodity prices fell, the stock market plunged and revenues shrank. Their debt burden is now seen as one of the main risks to the Russian economy, with the spectre of major bankruptcies hanging over the economy-wide rush to restructure loans. As a result of redemptions corporate foreign debt fell by $30 billion in the first quarter but the fresh data showed it started growing again. The central bank estimated commercial banks' foreign debt at $142.4 billion and the non-financial sector's foreign debt at $294.4 billion. The data showed that loans to the non-financial sector rose by $7.2 billion suggesting that some firms were able to borrow abroad. "Restructuring talks did not allow the debt to come down while possible non-public deals and eurobond issuance have increased it," said Yevgeny Nadorshin, chief economist at Trust Bank. Also on Friday, the central bank estimated Russia posted a current account surplus of $17.2 billion in January-June 2009, compared with $64.3 billion in the same period of last year. Russia's gas giant Gazprom and state-controlled Rosselkhozbank issued eurobonds while steel and coal producer Mechel and mobile network Mobile TeleSystems have restructured their debt in recent months. The central bank said liabilities to direct investors rose by $9.3 billion. In Russia, many enterprises are owned by offshore firms and eurobonds are issued through foreign-registered special purpose vehicles. The banking sector's debt fell by $4 billion as no Russian bank has been able to tap the international loan market. Banking sources told Reuters that state-owned Vnesheconombank (VEB) is looking to secure a syndicated loan worth up to $1 billion. (Reporting by Gleb Bryanski; Editing by Toby Chopra) Keywords: RUSSIA CBANK/DEBT ([e-mail] ; [phone]; Reuters Messaging: [e-mail] ) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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