Project Description
Food Security Guarantee (FSG, the Facility) in the form of an unfunded risk-sharing instrument covering up to 50 per cent of the credit risk in newly originated sub-loans with the total value of €40 million equivalent to be originated by Pro CroCredit Bank Ukraine (PCBU) subject to total 50 portfolio portfolio cap.
Project Objectives
The facility will be used to support lending to Ukrainian private companies operating in the primary and secondary agriculture and other critical industries (such as pharmaceuticals, food retail, transportation and logistics), with the ultimate goal of preserving livelihoods in the country.
Transition Impact
ETI score: 70
The Facility will support the Resilient and Inclusive TI qualities. The Resilient quality stems from credit enhancement mechanism provided by the FSG, which enables PCBU to finance Ukrainian agricultural value chains and other critical industries to preserve food security, retain jobs, support family incomes, maintain consumption and access to basic goods as a vital step in safeguarding people's livelihoods and to reduce losses due to supply chain disruptions, while shielding their loan portfolio for excessive risk prevailing in the current volatile conditions. The Facility will also support the Inclusive quality by providing funding to the Ukrainian businesses affected by the war, aimed at safeguarding their human and organisational capital.
Client Information
PROCREDIT BANK JSC
JSC ProCredit Bank in Ukraine is a 100 per cent-owned subsidiary of ProCredit Holding AG & Co. KGaA and one of the market leaders in financing small and medium-sized businesses in Ukraine. With USD 1 billion in total assets PCBU is among top 15 banks in Ukraine with ca. 1.5 per cent market share as of end of June 2022. The bank offers all types of conventional banking products (e-banking, cards, domestic and international payments; payroll services, documentary business and trade finance, as well as savings and personal banking services) through 8 outlets.
EBRD Finance Summary
EUR 10,000,000.00
Total Project Cost
EUR 40,000,000.00
Additionality
Response to the war in Ukraine: the Facility is provided in the extraordinary circumstances of the ongoing war on Ukraine, serving as a significant risk mitigating instrument to enable financing of critical industries.
Environmental and Social Summary
Categorised FI (ESP 2019). PCBU is an existing client of the EBRD and performance on environmental and social (E&S) issues to date has been satisfactory. Annual reporting, and previous E&S due diligence, demonstrates that the client has a written Environmental Management Policy, staff nominated to manage E&S issues, adequate E&S risk management procedures built into the credit appraisal process and appropriate monitoring for E&S issues both within the portfolio and within the institution itself. The management system is applied to the entire commercial lending portfolio. PCBU has also provided information to confirm compliance with PRs 2 and 4. PCBU will be required to continue to implement and comply with the relevant the EBRD's Environmental & Social (E&S) Risk Management Procedures, and submit annual environmental and social reports to the Bank.
Technical Cooperation and Grant Financing
TC: None
Non-TC: The project is approved on the basis of minimum 50 per cent of donor funding coverage. Non-TC funds for the First Loss Risk Cover (FLRC) in the amount of €5 million (50 per cent of the EBRD's risk share) are provided to the EBRD by the EBRD Crisis Response Special Fund under a specific window for the EBRD's War on Ukraine Response Package.
Company Contact Information
null+380 800 50 0990
https://en.procreditbank.com.ua
PSD last updated
13 Oct 2022
Understanding Transition
Further information regarding the EBRD’s approach to measuring transition impact is available here.
Business opportunities
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Environmental and Social Policy (ESP)
The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.
More information on the EBRD’s practices in this regard is set out in the ESP.
Integrity and Compliance
The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.
OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.
Access to Information Policy (AIP)
The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
Specific requests for information can be made using the EBRD Enquiries form.
Independent Project Accountability Mechanism (IPAM)
If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).
IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.
Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.
