The European Bank for Reconstruction and Development (EBRD) has approved a $500 million long-term loan to Russian Railways (RZD).

According to EBRD, the loan would allow the state-owned railway to restructure its balance sheet and support the completion of reforms of the world's second largest rail system despite the economic crisis and market contraction. 

This will be the largest single investment since the EBRD was founded in 1991. The transaction brings the amount invested by the EBRD in nine Russian rail projects to nearly $1.2 billion following the Russian government's decision in 2001 to launch a structural reform of the country's railway system, the bank said. Commenting on the loan approval, EBRD Business Group Director for Infrastructure Thomas Maier said that the bank, which has been deeply involved in Russian reform programs, was proud to participate in the process as it would help to achieve the ambitious reform gals RZD and the government have set, including the restructuring of freight operations and improving sector regulation.