EBRD to cover up to 50% of risk on newly issued sub-loans worth 50 mln euros by Ukrgasbank

MOSCOW. April 10 (Interfax) The European Bank for Reconstruction and Development has signed an agreement with the state-owned Ukrgasbank to provide an unfunded portfolio risk-sharing facility of 12.5 million euros to unlock 50 million euros of new financing for Ukraine's private sector amid the ongoing crisis.

"The EBRD's facility will cover up to 50% of Ukrgasbank's credit risk on newly issued sub-loans worth 50 million euros to private businesses operating in Ukraine," Ukrainian media reported, quoting an EBRD press release on Wednesday.

The United States, through the Crisis Response Special Fund, will provide first-loss risk cover to partially mitigate the risk associated with the new agreement.

Up to 20% of the risk-shared loans will support long-term investments by private micro-, small- and medium-sized enterprises in EU compliant and green technologies, improving the competitiveness of 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.

Ukrgasbank is the fifth largest bank in Ukraine, and one of 15 systemic banks in the country. It operates a country-wide network of 220 branches servicing around 1.5 million individuals and over 87,000 corporate and SME customers.

Ukrgasbank ranked fifth among Ukraine's 63 functioning banks by assets valued at UAH 189.99 billion as of February 1, 2024, according to the National Bank of Ukraine.