The U.S. Russia Investment Fund
| Company type | Investment fund |
|---|---|
| Industry | Private equity, financial services |
| Predecessor | Russian American Enterprise Fund, Fund for Large Enterprises |
| Founded | 1995 |
| Founder | United States federal government |
| Defunct | 2008 |
| Fate | Replaced by U.S. Russia Foundation; investment division acquired by Deutsche Bank |
| Headquarters | New York City , United States |
Area served | Russia |
Key people | Patricia Cloherty (chairman), James Cook (Managing Director) |
| Products | Investments in Russian enterprises, banking (DeltaBank), mortgage lending (DeltaCredit) |
| Owner | United States federal government, USAID |
The U.S. Russia Investment Fund (TUSRIF) was active from 1995 until 2008, created by the U.S. government to make private investments in Russia's economy. By 2005, it had allocated $300 million to 44 Russian enterprises. James Cook, serving as Managing Director, was instrumental in founding DeltaBank—the first Russian bank to provide credit cards—and DeltaCredit, which introduced residential mortgage lending in Russia. In 2008, TUSRIF transitioned to the U.S. Russia Foundation (USRF), and its investment division, Delta Private Equity Partners, was purchased by Deutsche Bank in 2009.
History
Established in 1995 by the United States federal government, TUSRIF combined two predecessor funds: the Russian American Enterprise Fund (RAEF) with $340 million and the Fund for Large Enterprises (FLEER) with $100 million, both predominantly financed by the United States Agency for International Development (USAID). Under the leadership of chairman Patricia Cloherty and managed by Delta Capital Management, TUSRIF sought to promote investment in Russia by providing capital from early to growth stages across industries including media, retail, consumer products, financial services, information technology, and telecommunications.
Together with Kohlberg Kravis Roberts & Company, TUSRIF held a majority 51% ownership of the Imperial Porcelain Factory until it was nationalized by the Russian government in 1999.
In 2000, TUSRIF initiated DeltaBank—the first bank in Russia to offer Visa credit cards—and obtained JPMorgan Chase’s banking license to launch DeltaCredit in 2001, marking the introduction of residential mortgage lending in the country. That same year, the Delta Russian Fund was created to raise $150 million aimed at reinvesting into Russia’s economy, including ventures in the Russian internet sector (Runet).
In 2002, TUSRIF invested $1 million in the financial trading firm Egar Technology, which was complemented by a $1.5 million contribution from the International Finance Corporation. Two years later, in 2004, GE acquired DeltaBank for $150 million.
By 2005, TUSRIF's holdings comprised DeltaBank, DeltaCredit, and two television broadcasters. That year also saw Société Générale purchase DeltaCredit for $100 million. In addition to these investments, TUSRIF supported small enterprises throughout Russia, with significant involvement in Nizhny Novgorod.
After being replaced by USRF in 2008, Delta Capital Management rebranded as Delta Private Equity Partners and was subsequently acquired by UFG Private Equity—a subsidiary of Deutsche Bank—in 2009. Between 2011 and 2012, USAID and Congress deliberated over reallocating $150 million from the fund; the Obama administration proposed dividing these resources between the Treasury Department and initiatives promoting American values within Russia, ultimately requesting $50 million be directed toward human rights organizations.