The European Bank for Reconstruction and Development (EBRD) is supporting food security and other critical industries in wartime Ukraine with a new risk-sharing agreement for KredoBank, a subsidiary of PKO Bank Polski.
Under the risk-sharing agreement signed today in London between the two institutions, which have an existing relationship, the EBRD provides a €25 million unfunded risk-sharing instrument, which covers 50 per cent of the credit risk of newly originated financing provided by KredoBank up to a total value of €100 million, subject to a portfolio cap of 50 per cent.
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 safeguard food security and preserve livelihoods in Ukraine, where core economic sectors have been severely impacted by Russia’s invasion last February.
In addition, €15 million of the total €100 million covered portfolio will be available to finance long-term investments of micro-, small- and medium-sized enterprises (MSMEs) in technologies and equipment to EU standards, including investments in sustainable and green technologies, under the SME Competitiveness Programme in the European Union’s (EU) Eastern Partnership (EaP SMEC).
By joining the EBRD EaP SMEC programme, KredoBank and its clients will also benefit from expert advice in the form of training and support provided by consultants. Eligible borrowers will receive grant support in the form of investment incentives upon the completion of their investment projects.
Boosting Ukraine’s food security during the war is one of the EBRD’s five strategic priorities for the country. The Bank 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.
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