EBRD to provide Ukrainian company OTP Leasing with 20 mln euro guarantee

MOSCOW. July 18 (Interfax) - The European Bank for Reconstruction and Development (EBRD) provides a 20 million euro guarantee to the largest Ukrainian leasing company OTP Leasing to support the agricultural businesses and other vital industries in Ukraine.

"OTP Leasing will use the guarantee to provide 80 million euros of financing that will support food security and other critical industries," Ukrainian media quoted the bank as saying on Tuesday following the signing of an unfunded risk-sharing agreement.

It is noted that the guarantee consisting of two parts covers up to 50% of credit risk under new contracts which will be concluded by OTP Leasing for the total amount of 80 million euros, but not more than 50% of the portfolio.

One part of the guarantee is provided under the Sustainability and Livelihoods Program for Ukraine and neighboring countries, which was established last year in response to the crisis in order to mitigate its economic impact.

The second part is supported by the EU4Business-EBRD Credit Line, which facilitates investment, in particular, in green technology in line with EU standards.

With the signing of this agreement, the total volume of such guarantees provided by the EBRD since the beginning of the crisis reached 368 million euros, the statement said.

OTP Leasing, according to the bank, has a market share of about 45% in Ukraine by the size of its leasing portfolio. The company provides financial leasing and transportation fleet management services to corporate clients and micro, small and medium-sized enterprises throughout the country. The ultimate owner of the company is OTP Bank Plc. (Hungary).

OTP Leasing CEO Andrei Pavlushin said earlier that in the first half of 2023 the company funded Ukrainian clients for UAH 2.2 billion, which is 3-4% more than in the first half of 2022.