EBRD provides PrivatBank and Ukrgasbank with guarantees to attract EUR900 mln in loans
The European Bank for Reconstruction and Development (EBRD) will provide state-owned PrivatBank and Ukrgasbank (both Kyiv) with unfunded credit lines with a total guarantee volume of EUR274 million, which will allow Ukrainian banks to issue up to EUR900 million in new loans to support businesses, energy projects and households under martial law.
“We are proud that EBRD’s guarantees will unlock lending at these record levels to allow PrivatBank and Ukrgasbank to provide much-needed funding to Ukrainian companies and households that will support sub-borrowers’ resilience and preserving of livelihoods in the country during the ongoing war,” said Arvid Tuerkner, EBRD Managing Director, Ukraine and Moldova.
"PrivatBank will benefit from a EUR185 million guarantee to unlock up to EUR600 million in new financing — the largest portfolio risk-sharing facility implemented in Ukraine to date. The facility will focus on supporting micro, small and medium-sized enterprise (MSME) clients, with EUR415 million available under the EBRD’s Resilience and Livelihoods Guarantee (RLG) to address immediate liquidity and investment needs across key sectors. In addition, EUR95 million under the Energy Security Support Facility (ESSF) will drive investments aimed at strengthening Ukraine’s energy resilience, while a further EUR90 million under the EU4Business-EBRD Credit Line will be directed toward long-term capital investments by MSMEs, supporting upgrades of equipment and technology to meet EU standards," the bank said.
"The EBRD’s EUR89.2 million guarantee in favor of Ukrgasbank will support up to EUR300 million in new lending. Of this total, up to EUR160 million will be channeled under the ESSF – the largest ESSF sub-limit delivered in Ukraine to date – supporting eligible sub-projects in energy generation, energy storage, and energy efficiency for private businesses, state-owned enterprises, municipalities and municipal companies, households, and housing associations. An additional EUR80 million under the RLG will enable Ukrgasbank to finance working capital and investment needs for Ukrainian private companies operating in essential sectors of the economy. A further EUR60 million under the EU4Business-EBRD Credit Line will enable Ukrainian MSMEs to modernize operations and align with EU technical standards, enhancing their competitiveness," reads the report.
"Under both facilities, residential sub-borrowers (households and housing associations) will receive up to 10% of the total investments under the ESSF sub-limits, benefiting from grant support funded through EBRD Crisis Response Special Fund (CRSF), with the United States and The Netherlands as major contributors. For PrivatBank the total amount of incentives for residential sub-borrowers will be EUR1.5 million, for Ukrgasbank EUR1.6 million," it says.
"In addition, grant support for eligible MSMEs under the EU4Business-EBRD Credit Line will cover 10-30% of their investment costs funded by the CRSF. Higher incentives will be provided for businesses and households most affected by the war on Ukraine, including those impacted by asset destruction, loss, or relocation due to the war, as well as sub-borrowers facilitating the reintegration of war veterans, persons with disabilities, internally displaced persons, and/or those located in the acutely war-affected territories of Ukraine," it reads.
