UniCredit Leasing-Ukraine

By Anton Usov

$25 million credit line to provide leases to local small businesses

The EBRD is continuing to support Ukraine’s banking and SME sectors by providing a loan of $25 million to UniCredit Leasing Ukraine. The loan to UniCredit Leasing acknowledges the importance of leasing as an alternative form of financing for smaller businesses that do not have the resources to buy capital intensive equipment straight away. In the current liquidity crisis, channelling long-term funding through leasing companies provides much-needed support to the real economy.

The loan is a part of the $125 million financing package for the UniCredit Group in Ukraine approved by the EBRD Board of Directors in 2009.

Support for leasing operations is crucial for smaller businesses in Ukraine, since currently most of the banks tend to focus on higher margin retail clients and larger businesses. As a result leasing increasingly remains is the only viable alternative for SME clients.

This transaction is an important part of the EBRD’s response to the impact of the financial crisis on Ukraine. $870 million, or fifty seven per cent of the Bank’s annual commitments in Ukraine, were signed in 2009 in the banking sector thus providing timely subordinated debt and equity funding to a number of banks in order to reinstate market confidence and stability of the Ukrainian banking system.
 The European Bank for Reconstruction and Development is the biggest financial investor in Ukraine. As of 1 January 2010, it had committed €4.8 billion through 194 projects.