- EBRD provides new unfunded portfolio risk-sharing facility to ProCredit Bank Ukraine
- Facility will unlock €60 million of new financing to support energy security for Ukrainian businesses and households
- Supported by the Netherlands, France and European Union
The European Bank for Reconstruction and Development (EBRD) is supporting Ukraine’s businesses and residents through a new unfunded portfolio risk-sharing facility for ProCredit Bank Ukraine (PCBU) that will help improve energy security.
Backed by the EBRD guarantee under its Energy Security Support Facility* (ESSF), the PCBU will provide up to €60 million in subloans to private businesses and households that will help channel urgently needed investments into energy generation, storage capacity and energy-efficiency enhancements. At least 70 per cent of the subloans will go to projects that align with the EBRD’s Green Economy Transition (GET) approach.
Up to 20 per cent of all subloans covered by the EBRD guarantee will support financing of long-term capital investments by micro, small and medium-sized enterprises (MSMEs) to upgrade their technology and equipment in line with European Union (EU) standards under the EU4Business-EBRD Credit Line. Residential sub-borrowers (households and housing associations) will receive up to 8 per cent of the total investments. They will also benefit from grant support funded by the Netherlands through the EBRD’s Crisis Response Special Fund, which will cover 10-30 per cent of their investment costs financed under the ESSF.
Higher incentives will be provided for businesses and households most affected by Russia’s ongoing war against Ukraine. This will include those impacted by asset destruction, loss or relocation, as well as sub-borrowers that are facilitating the reintegration into the workforce of war veterans, persons with disabilities, internally displaced persons and/or those located in territories most acutely affected by the war.
The EBRD facility will be backed by first-loss risk cover from France and the EU under its Ukraine Investment Framework.
This is the sixth time that the EBRD has provided a portfolio risk-sharing facility to PCBU since the start of Russia’s full-scale invasion of Ukraine, building on the success of previous instruments. Overall, the EBRD has unlocked more than €2 billion in financing for Ukrainian borrowers through its portfolio-risk sharing facilities with partner financial institutions in the country.
PCBU is a wholly owned subsidiary of ProCredit Holding AG and one of Ukraine’s 15 largest banks in terms of assets. It is a market leader in SME finance in Ukraine and a longstanding partner of the EBRD.
PCBU has committed to supporting war veterans (both as employees and as clients) and will implement key recommendations 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.
The EBRD is Ukraine’s largest institutional lender and has significantly increased its lending to the country in recent years, making a total of €7 billion available since the start of the war in February 2022. The Bank has also secured agreement from its shareholders for a capital increase of €4 billion to continue lending at this level during wartime, and will raise its finance further when the time comes for reconstruction.