EBRD to cover up to 50% of risk on Ukreximbank's new loans worth 40 mln euros

MOSCOW. March 28 (Interfax) - The European Bank for Reconstruction and Development (EBRD) will provide a ten-million-euro guarantee to state-run Ukreximbank, thus covering up to 50% of the risk on new loans worth of 40 million euros, the EBRD said on Wednesday.

"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," Ukrainian media quoted an EBRD press release.

The EBRD Board of Directors approved the facility on January 26. The United States will provide first-loss risk cover through the Crisis Response Special Fund to partially mitigate the risk associated with the new exposure, it said.

The facility includes an 8-million-euro sublimit, up to 20% of the risk-shared loans to support private micro-, small and medium-sized businesses' (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," the EBRD said.

The overall new loans supported by such guarantees since the beginning of the crisis neared 900 million euros as of the end of 2023.

According to the National Bank of Ukraine, Ukreximbank ranked third terms of overall assets (274.65 billion hryvni) as of February 1, 2024. Headquartered in Kiev, the bank has 50 branches nationwide, in addition to two offices in London and New York.