EBRD extends new guarantee to UKRSIBBANK to unlock €30 million of new finance

This article is brought to you in association with EBRD.

• EBRD provides unfunded portfolio risk-sharing facility to UKRSIBBANK
• Facility will unlock €30 million of new financing for Ukrainian businesses and households
• Focus on critical industries and energy investments, with EU support for competitiveness upgrades

The European Bank for Reconstruction and Development (EBRD) is extending a new unfunded portfolio risk-sharing facility to Ukraine’s UKRSIBBANK BNP Paribas Group to unlock €30 million of new finance for Ukrainian businesses and households amid Russia’s ongoing war on Ukraine.

The EBRD’s facility will cover up to 50 per cent of UKRSIBBANK’s credit risk on €30 million of new subloans to borrowers in Ukraine. Under this facility, UKRSIBBANK will provide subloans to companies in critical industries such as agribusiness, manufacturing, pharmaceuticals, transport and logistics, as well as residential borrowers who are looking to implement energy security projects. This is the second time that the EBRD has provided such a facility to UKRSIBBANK.

Up to 20 per cent of total subloans will support the financing of long-term capital investments by micro, small and medium-sized enterprises, helping them to upgrade their technology and equipment in line with European Union (EU) standards under the EU4Business-EBRD Credit Line. Eligible subborrowers will also receive EU-funded technical assistance and grant support funded by the EBRD’s Crisis Response Special Fund.

Up to 10 per cent of total subloans will be granted to residential subborrowers (households and housing associations) to finance energy generation, energy storage and energy efficiency investments under the EBRD’s Energy Security Support Facility. At least 70 per cent of subloans will finance projects supporting the transition to a green economy.

Residential subborrowers will receive technical assistance with the structuring and implementation of their energy investments. Grant support for eligible subborrowers will cover up to 20 per cent of their investment costs and will be funded by Canada through the High-Impact Partnership on Climate Action.

Subborrowers whose assets have been destroyed, lost or relocated due to the war will be supported by additional investment incentives, as will subborrowers who are engaged in reintegrating veterans into the workforce.

The EBRD’s facility will be backed by first-loss risk cover funded by France and the European Union (under the EU’s Ukraine Investment Framework).

UKRSIBBANK is one of the largest lenders in Ukraine, with a strong market presence and wide-ranging expertise in supporting the private sector and agribusinesses. It is majority-owned by BNP Paribas, with the EBRD as a minority shareholder. It is committed to supporting war veterans (both as employees and as clients) and will implement key recommendations in the Guidance Note to Support Ukrainian Financial Institutions in Becoming More Inclusive, Safer, and More Accessible Employers, which was developed jointly by the EBRD and the National Bank of Ukraine.

The EBRD is the largest institutional investor in Ukraine, with cumulative investment of more than €22 billion across more than 600 projects. Since the start of Russia’s full-scale invasion, the Bank has deployed more than €7 billion in Ukraine’s real economy.