Russia’s state-owned Vnesheconombank, or VEB, may provide a US$1bn loan to AvtoVAZ, a banking source has told Prime-Tass.
The Russian news agency also said that Globexbank, a subsidiary of VEB, has provided a 3bn ruble tranche to AvtoVAZ under a newly opened credit line.
AvtoVAZ is being financed as part of a program to support companies in core economic sectors.
Russia’s largest car makers – AvtoVAZ , Gaz Group and KamAZ – have all turned to the state for help, with some halting production lines, citing a double-digit drop in demand.
The Russian government recently said it will support the country’s automobile industry, which has seen a drop in activity, during the financial crisis.
The government will possibly subsidise interest rates on loans that car producers pay to banks, Russia’s President Dimitry Medvedev has said.
State assistance for Russian carmakers was written into a USD200bn state aid package, including a provision to lower interest rates on loans taken by car manufacturers.
Early this month, the government also sharply raised import tariffs on second-hand foreign cars, a protectionist measure for which the industry has long lobbied.