Resilience and Livelihoods Guarantee (RLG) in the form of an unfunded risk-sharing instrument of up to €7.5 million to Bank Lviv in Ukraine. The guarantee covers up to 50 per cent of the credit risk in newly originated sub-loans with the total value of €30 million equivalent (the "Covered Portfolio") subject to total 50 per cent of portfolio cap.
The Project will include a sub-limit under the SME Competitiveness Programme in the European Union's (EU) Eastern Partnership ("EaP SMEC" sub-limit, assigned with a separate EBRD project number 54661) of up to €4.5 million or 15% of the Covered Portfolio to finance long term capital investments of micro-, small-, and medium sized enterprises (MSME) to upgrade their technologies and equipment to EU standards, including investments in sustainable and green technologies (70% of EaP SMEC sub-limit), thereby enhancing businesses' competitiveness. Eligible sub-borrowers will also receive technical assistance funded by the EU and grant support in the form of investment incentives upon the completion of their investment projects.
The facility will be used to support lending to Ukrainian private companies (predominantly MSMEs) operating in the primary and secondary agriculture and other critical industries (inter alia food processing, retail, logistics), with the ultimate goal of preserving livelihoods in Ukraine.
ETI score: 70
The Facility will support the Resilient and Inclusive TI qualities.
The Resilient quality stems from credit enhancement mechanism provided by the RLG, which enables Bank Lviv to finance Ukrainian agricultural value chains and other critical industries to preserve food security, retain jobs, support family incomes, maintain consumption and access to food as a vital step in safeguarding people's livelihoods and to reduce losses due to supply chain disruptions, while shielding their loan portfolio from 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, as well as Competitive quality (via EaP SMEC sub-limit) by improving MSME investments in line with EU standards, enhancing their competitiveness in domestic and export markets.
BANK LVIV JSC
A regional SME-focused bank in the western part of Ukraine with total assets of USD 216 million (ranked #25, 0.3% market share) and a loan portfolio of USD 133 million as of end-1Q2023. The bank has a head office in Lviv and 19 branches (13 in Lviv region and 6 in Kyiv, Lutsk, Uzhgorod, Ivano-Frankivsk, Rivne, and Ternopil).
EBRD Finance Summary
Total Project Cost
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): Bank Lviv is an existing client and will continue to comply with PRs 2,4 &9, and further, implement and comply with the relevant EBRD's Environmental & Social (E&S) Procedures. An Environmental Social Monitoring Plan ("ESMP") has been developed under the previous transaction and its implementation status was reviewed during the due diligence.
Technical Cooperation and Grant Financing
Non-TC: The project is approved on the basis of minimum 50 per cent of donor funding coverage as the first loss risk cover in the amount of €3.750 million (50 per cent of the EBRD's risk share).
TC and non-TC under EaP SMEC sub-limit: MSME sub-borrowers will benefit from the EU funded financial incentives (up to 30 per cent of the lower of sub-loan disbursed amount or investment cost) for eligible sub-projects, while the bank will receive technical assistance from dedicated consultants towards investment projects preparation and implementation.
Company Contact Information
+38 050 438 54 19
1, Serbska str., Lviv, Ukraine, 79008
PSD last updated
19 Jul 2023
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