EBRD extends unfunded portfolio risk-sharing facility to Raiffeisen Bank UkraineFacility will unlock €200 million of new financing for Ukrainian businesses Focus on critical industries and MSMEs, with EU support for competitiveness upgrades
The European Bank for Reconstruction and Development (EBRD) is extending an unfunded portfolio risk-sharing facility to Ukraine’s Raiffeisen Bank Ukraine (RBU) to unlock €200 million of new finance for Ukraine’s businesses amid Russia’s ongoing war on the country.
The EBRD’s facility will cover up to 50 per cent of Raiffeisen’s credit risk on new finance worth €200 million for businesses operating in Ukraine. Through this credit enhancement mechanism, RBU will provide subloans to companies in critical industries such as agribusiness, manufacturing, pharmaceuticals, transport and logistics.
This is the fourth such EBRD facility extended to RBU.
Similar to previous instruments, the new facility will enhance the competitiveness of micro, small and medium-sized enterprises (MSMEs) in the European Union’s (EU) Eastern Partnership countries. Twenty per cent of the subloans covered by the EBRD guarantee will be provided to MSMEs for long-term investments in EU-compliant and green technologies, improving their competitiveness on domestic and foreign markets.
Eligible sub-borrowers will also receive EU-funded technical assistance and investment incentives such as grants on completion of their investment projects under the bloc’s EU4Business initiative. Higher levels of incentive will be provided for businesses and households most affected by the war (such as those experiencing asset destruction, loss or relocation), as well as sub-borrowers, facilitating the reintegration into the workforce of war veterans, people living with disabilities, internally displaced persons and/or those located in territories most acutely affected by the war.
RBU has also committed to supporting war veterans (both as employees and as clients). It will implement key recommendations set out in the Guidance Note to Support Ukrainian Financial Institutions in Becoming More Inclusive, Safer, and More Accessible Employers, which was developed by the EBRD and National Bank of Ukraine.
Francis Malige, EBRD Managing Director for Financial Institutions, said: “We’re proud to strengthen our partnership with RBU and enable new finance for Ukrainian businesses through this transaction. It is another sign of how we are responding to our partner banks’ needs, while delivering value to the wider business sector and economy.”
Oleksandr Pysaruk, CEO of Raiffeisen Bank Ukraine, said:
“We are proud to deepen our partnership with the EBRD at such a critical time for Ukraine. This facility allows us to continue financing essential sectors of the economy while also enabling SMEs to invest in modern, green technologies that strengthen their long-term competitiveness.”
The EBRD facility will be backed by partial first-loss risk cover from France, as well as the EU under its Ukraine Investment Framework.
Since the start of Russia’s full-scale war on Ukraine, the EBRD has enabled more than €3 billion of finance for Ukrainian borrowers through 37 similar facilities with 12 partner financial institutions.
Raiffeisen Bank Ukraine is the largest private bank in Ukraine, and the fourth largest overall. The EBRD has had a longstanding and successful relationship with RBU since 1998.
The EBRD is Ukraine’s largest institutional lender, having invested more than €8 billion in its real economy since the start of the war in February 2022. A further €4 billion capital increase has been secured to continue supporting the country’s economy during wartime and for future reconstruction efforts.