The public loan of the Nizhni Novgorod region is issued as authorized by the Nizhni Novgorod regional Soviet of People's Deputies in order to offset the effects of the reforms in Russia, to form an extra-budgetary stabilization fund and to develop the financial market in the Nizhni Novgorod region.

The Nizhni Novgorod regional Soviet of People's Deputies performs its duties pursuant to the current legislation of the Russian Federation.

Legal and post-box addresses of the emitter: Bldg 2, Kremlin, Nizhni Novgorod, 603082.

The Soviet's authorization to issue the loan is signed by Evgeny Krestjaninov, Chairman of the Nizhni Novgorod regional Soviet of People's Deputies. Krestjaninov was born in 1948. In 1972 he graduated from Gorki State University, where he majored in radio physics. From 1990 to 1991 he was Deputy Chairman of the Prioksky district Soviet in Nizhni Novgorod. Since 1991, he has worked as Chairman of the Nizhni Novgorod regional Soviet of People's Deputies.

PART B. THE FINANCIAL STANDING OF THE EMITTER

The performance of the budget of Nizhni Novgorod region

REVENUES	1989	1990	1991
Turnover tax	211,7	64.4	735.7
Profit payments	344,3	341.2	585.9
Population state taxes	180,2	238.7	807.6
Budget balance at the beginning of the year, to go to cover expenses	31,3	69.9	120.0
Other revenues	409,8	177.2	1253.1
Total revenues	1177,3	891.4	3502.3
Revenues from the federal budget	52.9	123.3	-
Mutual settlements	-	-	500.5
Overall revenues	1230.2	1014.7	4002.8
Low-level budget	335,1	396.2	2649.7
Overall revenues including domestic turnover	1298.4	1410.9	6152.0
Budget balance at the beginning of the year except sums used to cover expenses	58.1	67.1	46.7
BALANCE	1356.5	1478.0	6198.7

EXPENDITURES

	1989	1990	1991
National economy	202.6	238.8	1042.7
Social and cultural programmes	536	614.0	1282.4
Funding from state authorities	18.7	31.4	66.9
Other	26.0	22.9	394.7
Tota	783.8	997.1	2786.7

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Section C. Information on the impending issue of securities

General Information.

Government bonds worth 5 billion roubles in total will be issued by Nizhni Novgorod Oblast.

In all, 16.36 million bonds will be issued, with six nominal values:

Nominal Value(in roubles)	Number of bonds(mln roubles)	Total Value(bln roubles)
50	7	0.35
100	6	0.60
500	2	1.00
1,000	1	1.00
5,000	0.31	1.55
10,000	0.05	0.50
TOTAL	6.36	5.00

Terms of Issue

The Nizhni Novgorod government bonds are issued in accordance with resolution No.176 of the regional Soviet of People's Deputies, dated June 23, 1992, as per point 6 of article 45 of the law of the Russian Federation "On the Territorial and Regional Soviets of People's Deputies and Territorial and Regional Administrations."

Nizhni Novgorod government bonds were first issued on August 15, 1992. All bonds should be distributed by December 31, 1994.

The bonds may be acquired by any legal entities and private individuals strictly on voluntary basis.

The nominal value is printed on the bonds.

The bonds are distributed by money transfer to the account of the special extra-budgetary stabilisation fund, No. 001142709 of the settlement and encashment centre of the main department of the Russian Federation Central Bank,

Nizhni Novgorod Oblast, MFO 116002, and the subsequent acquisition of the bonds with a corresponding nominal value.

Bonds may be used by the region's enterprises and organisations to cover the wages and other monetary income of those individuals who have not been paid owing to insufficient cash supply.

The region's enterprises and organisations may offer the bonds to their employees.

Without restriction, the bonds may be directly issued to interested individuals by their banks, which entails an immediate withdrawal from those individuals' savings or other accounts.

A bond's value and settlement terms Nizhni Novgorod government bonds are distributed in accordance with their nominal value.

The treasury will cash the bonds upon the first request by the bearer.

Individuals may freely cash in their bonds to the enterprises which issued them, with a consequent crediting to their personal accounts, or to their savings or other bank accounts, in the amount of the nominal value of the bonds.

Legal entities may freely cash in their bonds at commercial banks, with the consequent crediting to their settlement (current) account in the amount of the nominal value of the bonds.

Commercial banks may freely cash their bonds at the treasury, with the consequent crediting to their account in the amount of the nominal value of the bonds.

The administration of Nizhni Novgorod region will stipulate the bonds settlements procedure in accordance with the terms of this prospectus.

ORGANISATIONS INVOLVED IN THE DISTRIBUTION OF THE BONDS

The administration of Nizhni Novgorod region will fulfil all requisite placement, issue and redemption transactions related to Nizhni Novgorod government bonds.

The treasury is an independent subdivision of Nizhni Novgorod's Finance Department.

It will service the 1992 government bonds of Nizhni Novgorod region. The settlement and encashment centres of the main territorial division of the Bank of Russia's Nizhni Novgorod Region branch will issue the bonds.

Bond dividends.

The regional authorities will establish a floating interest rate for the bonds, dependent on the inflation rate and acute cash and monetary crisis in the region.

Until the end of 1992, the bonds will not accumulate interest.

The regional authorities will determine the rate of interest and procedure used to calculate and pay out bond dividends.

Other terms.

Nizhni Novgorod government bonds will be backed by all regional and municipal assets, in accordance with the law of the Russian Federation "On Property in the RFSFR."

Nizhni Novgorod bonds will also be entitled treasury consumer notes.

The Nizhni Novgorod bonds will circulate freely and be valid for all payment transactions in the region.

Nizhni Novgorod's administrative authorities will ensure that all enterprises and institutions accept the government bonds as payment at their nominal value.

Utilisation of the funds accrued from the bond issue.

All funds accrued from the issuance of Nizhni Novgorod Oblast government bonds will be held in the extra-budgetary stabilisation fund. The regulations on the extra-budgetary stabilisation fund will be endorsed by the Nizhni Novgorod Regional Soviet of People's Deputies, in accordance with this prospectus.

Up to 50% of the resources of the Nizhni Novgorod extra- budgetary stabilisation fund will be placed in equal shares in three- and six-month deposit accounts at commercial banks. If additional monetary funds are not needed to back the free circulation of the bonds, the deposit accounts may be extended or reinvested.

The remainder of the extra-budgetary stabilisation fund will be used as a reserve fund to be exchanged for bonds, and will be kept as residual monetary funds in the treasury account or as highly liquid assets. The administration of Nizhni Novgorod region will take decisions on whether to use the reserve fund.

The interest accrued in the deposit accounts of the extra- budgetary stabilisation fund will be used to offset bond servicing expenditures. The administration of Nizhni Novgorod Region (Oblast) will draft quarterly reports on the utilisation of the extra-budgetary stabilisation fund. The reports will be submitted to the Nizhni Novgorod Regional Soviet of People's Deputies for approval and will then be published in the press.

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