27/03/2024

The European Bank for Reconstruction and Development (EBRD) is providing an unfunded portfolio risk-sharing instrument to Ukreximbank for new financing for the private sector amid the ongoing war in the country in the amount of €40 million.

The EBRD’s facility could cover up to 50 percent of Ukreximbank’s credit risk on newly issued sub-loans worth €40 million to private businesses operating in Ukraine.

The facility will enhance Ukreximbank’s lending capacity, enabling the lender to provide much needed funding to Ukrainian businesses operating in critical industries such as agriculture, manufacturing, construction, transport and pharmaceuticals.

This will support companies to continue their operations and safeguard livelihoods, which is crucial for fostering economic resilience and enabling Ukraine to rebuild in the aftermath of the war.

The United States of America, through the Crisis Response Special Fund, will provide first-loss risk cover to partially mitigate the risk associated with the new exposure.
  
The part of risk-shared loans will support private MSMEs’ long-term investments in EU compliant and green technologies, improving Ukrainian MSMEs’ competitiveness on domestic and foreign markets.

Eligible sub-borrowers will also receive EU-funded technical assistance and investment incentives upon completion of their investment projects under its EU4Business initiative.

"For 30 years, Ukreximbank has been combining the EBRD's financial resources with the needs of Ukrainian borrowers through customised programmes based on the principles of sustainable development. During the war and during the post-war recovery, access to investment and commercial funds, as well as instruments to cover war risks, was crucial for Ukreximbank's clients from priority sectors of the economy. The new instrument from the EBRD will undoubtedly strengthen the resilience and adaptability of the Ukrainian economy," said Oleksandr Shchur, Member of the Management Board of Ukreximbank.

“Supporting the private sector is at the heart of our mandate at the EBRD, and we are proud that our cooperation with Ukreximbank enhances our ability to reach and provide finance to private firms in Ukraine,”  said Arthur Poghosyan, Deputy Head of EBRD's Ukraine Office with responsibility for Financial Institutions.

JSC Ukreximbank is a systematically important State-owned-bank, 100 per cent controlled by the Government of Ukraine. It is consistently among the largest banks in Ukraine, serves a significant number of Ukrainian exporting companies of private and state ownership, has the most extensive network of correspondent banks in the country, and successfully cooperates with the International Bank for Reconstruction and Development, the European Bank for Reconstruction and Development, the European Investment Bank, the International Finance Corporation, other leading international financial organizations, foreign banks and financial institutions.

The EBRD has deployed €4 billion in Ukraine since the start of the war. As well as support for the private sector, its strategic priorities in the country are supporting energy security, vital infrastructure, food security and trade.