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- Kredobank a new EBRD partner financial institution in Ukraine with risk-sharing facility worth €8.75 million
- EBRD to cover half of credit risk on Kredobank’s new financing
- Facility to support €35 million of new lending to agribusiness and companies in other critical industries
The European Bank for Reconstruction and Development (EBRD) is supporting food security and other critical industries in wartime Ukraine by extending a risk-sharing facility to Kredobank, a subsidiary of PKO Bank Polski.
Under a new risk-sharing agreement between the two institutions, the EBRD will back 50 per cent of the credit risk of newly originated financing provided by Kredobank up to a total value of €35 million, subject to a portfolio cap of 50 per cent.
The EBRD’s share of risk comes to €8.75 million. The guarantee comes in the wake of similar facilities signed in November this year and brings its total volume of enabled financing to €288 million since the start of the war.
The risk-sharing facility will help Kredobank to provide access to finance for Ukrainian companies operating in critical industries, such as primary agriculture and agricultural services, food processing, transport and logistics, retail and pharmaceuticals. It will also help to safeguard food security and preserve livelihoods in Ukraine, where core economic sectors have been severely impacted by Russia’s invasion on 24 February 2022.
The EBRD facility will be supported by a 50 per cent donor-funded first-loss risk cover as part of the Bank’s resilience package arrangements.
Boosting Ukraine’s food security during the war is a priority for the EBRD. The Bank’s dedicated food security package envisages supporting €200 million of investment in Ukraine this year. The EBRD is also supporting trade, energy security, vital infrastructure and the pharmaceuticals industry and has committed to investing up to €3 billion in the country in 2022-23.
The EBRD was swift to condemn the Russian invasion and pledged to stand by Ukraine. In early April, the EBRD’s Board of Governors voted to suspend open-endedly the access of Russia and Belarus to EBRD finance and expertise, and the Bank has closed its offices in both countries.
In addition to a resilience package for Ukraine and neighbouring countries affected by the war, the EBRD has pledged to help finance Ukraine’s reconstruction once conditions permit.
Kredobank is a leading bank in western Ukraine, ranked 14th by total assets (US$ 1.1 billion). Kredobank is wholly owned by PKO Bank Polski SA, the largest systemically important bank in Poland, listed on the Warsaw Stock Exchange.