Western Ukrainian businesses receive new funds from EBRD and EU

Western Ukrainian businesses receive new funds from EBRD and EU

  • EBRD four-year €7.5 million loan to Bank Lviv
  • Long-term local currency lending to support Ukrainian SMEs
  • Project supported by EU with incentive grants under EU4Business initiative

Small and medium-sized enterprises in western Ukraine will benefit from a new loan of up to €7.5 million to Bank Lviv provided under the EU4Business-EBRD Credit Line. The loan will be available for disbursement in Ukrainian Hryvna, which will protect Bank Lviv’s borrowers from foreign currency-related risks, and offer long maturities.

The funds are provided in the context of the Deep and Comprehensive Free Trade Agreement (DCFTA) between the European Union (EU) and Ukraine. EU grants will be offered as investment incentives to eligible enterprises to reduce the cost of their capital expenditure on upgrades of technology and production processes to comply with EU standards and regulations.

Bank Lviv and its clients will also receive technical assistance from the EU4Business-EBRD Credit Line consultants, who will assist with projects preparation and implementation.

Bank Lviv CEO Ashot Abrahamyan said: «The deal we signed today with the EBRD represents a convincing example of what real partnership means in difficult times. As a bank, we are committed to continue providing financing to SMEs, especially to agricultural producers. We are grateful to the EBRD and the EU for their commitment and readiness to support our institution and our clients, so that we can move forward together»

Bank Lviv is a regional bank providing banking services to SMEs and private clients across western Ukraine.  It is well established in the Lviv, Ivano-Frankivsk, Lutsk, Rivne, Ternopil and Uzhgorod regions as well as the capital Kyiv.

The EBRD is a leading institutional investor in Ukraine and to date has committed more than €14.54 billion in over 460 projects to the country.

EBRD and EU allocate the third tranche of EUR 15 million to OTP Leasing to support the Ukrainian businesses

EBRD and EU allocate the third tranche of EUR 15 million to OTP Leasing to support the Ukrainian businesses

A 4-year EBRD senior loan of up to €15 million to OTPL facilitates long-term leases to SMEs across the country. The funding will be available under the EU4Business-EBRD Credit Line and is part of the Deep and Comprehensive Free Trade Agreement (DCFTA) between the European Union (EU) and Ukraine.  

The EU4Business-EBRD Credit Line funding is complemented by grant incentives, financed by the EU4Business initiative, helping enterprises to reduce the cost of technology and production upgrades and help investors align with EU standards and regulations. SMEs benefit in many ways, including improving the quality of their products, protect the Health & Safety of their workers and their customers, in some cases reduce energy and fuel costs and, most importantly, improve their competitive positioning.

The EBRD and Ukraine’s leading leasing company LLC “OTP Leasing” (OTPL) are helping local small and medium-sized enterprises (SMEs) continue their business activities despite the current market turmoil caused by the outbreak of the coronavirus (COVID-19).

OTPL will make funding to their clients available in both Ukrainian Hryvnia and/or Euro. Ukrainian Hryvna leasing financing will of course offer more protection from foreign currency-related risks for lessees and offer longer maturities.

OTP Leasing received a second tranche of EUR 10 million

OTP Leasing received a second tranche of EUR 10 million

OTP Leasing(OTPL), one of the Partner Financial Institutions under the EU4Business-EBRD Credit Line, successfully disbursed the first tranche of EUR 10 million at the beginning of 2019, by leasing equipment to small and medium-sized enterprises. More than 70 clients of OTPLthatreceivedfinancing for equipment leasing,alsoreceived a grant incentive from the European Union under the EU4Business initiative,amounting to 10% of the leasing contract value.

At the end of August this year, the EBRD concluded anew loan agreement with OTPL and allocated the newtrancheofEUR 10 million to continue its support to small and medium businesses. In Ukraine The EU4Business-EBRD Credit Line allowssmall and medium-sized enterprises to modernisetheirproduction, increasetheir competitiveness and bring production processes in line with EU standards and compete effectively in European markets.

To learn more about the terms of the EU4Business-EBRD Credit Linein Ukraine: eu4business-ebrdcreditline.com.ua

EBRD and EU launch SME credit line in Ukraine

EBRD and EU launch SME credit line in Ukraine

  • EU4Business-EBRD Credit Line launched in Ukraine, individual borrowers can receive loans of up to €3 million in UAH equivalent
  • Thousands of Ukrainian SMEs to benefit from funds worth up to 60 million
  • Credit line to support production upgrades, export potential

Thousands of small and medium-sized enterprises (SMEs) in Ukraine stand to benefit from new financing opportunities offered by the EBRD and the EU.

In a joint initiative, both institutions are introducing the EU4Business-EBRD Credit Line to Ukraine designed to finance projects of SMEs and helping companies to use opportunities available under the Deep and Comprehensive Free Trade Agreement (DCFTA) between the EU and Ukraine.

The credit line will support privately-owned businesses registered in Ukraine with up to 250 employees. Individual borrowers can receive up to €3 million in Ukrainian hryvnia (UAH) equivalent. The local currency loans will protect borrowers from FX-related risks and have long maturities. 

The credit line will initially be operated through the State Export-Import Bank of Ukraine (UkrEximBank), which has earmarked an allocation of funds worth €22 million (US$ 25 million) and OTP Leasing Ukraine with an allocation of €10 million. Additional loan resources of around €28 million are expected in the near future and will be available to other local financial institutions set to join the credit line.

Participating companies will also receive support in adjusting their production to relevant EU Directives, which will allow them to access the EU single market as competitive contenders.

In addition, the EU4Business-EBRD Credit Line will also offer grant incentives to qualified projects. Ukrainian SMEs willing to use eligible technologies, achieve full compliance with sanitary, phytosanitary and food safety regulations or implement complex projects that comply with several EU regulations, will be able to receive an incentive grant for up to 15 per cent of the project cost. 

The list of eligible technologies and corresponding regulation is available here.

Ambassador Hugues Mingarelli, Head of the EU Delegation to Ukraine: “The EU works hard to ensure that these credit lines bring concrete benefits to the Ukrainian small and medium enterprises — and contribute to both economic growth in Ukraine and stronger economic ties between Ukraine and the EU. In 2018 Ukrainian exports to the EU grew by 15 per cent, imports by 11.5 per cent compared to the previous year; we see these DCFTA credit lines as instrumental in continuing these positive trends.”

Matteo Patrone, EBRD Managing Director, Eastern Europe and the Caucasus, said: “This credit line is about integration both in a geographical and an economic sense. Following the establishment of the DCFTA between the EU and Ukraine, multiple opportunities have opened for domestic businesses. The launch of the EU4Business-EBRD Credit Line provides local SMEs, which create almost 80 per cent of jobs in the country but are currently responsible for only about 40 per cent of GDP, with additional access to finance, so they can develop further, become more competitive and comply with EU standards.”

The credit line supports the shared EBRD/EU objectives of increasing business competitiveness and economic integration in line with the EU’s DCFTA goals and the EBRD’s transition mandate. The launch sends a strong signal of the two institutions’ commitment to Ukraine, contributing to a competitive and well-integrated economy. 

OTPL raises interest in DCFTA opportunities during InterAgro in Kiev

OTPL raises interest in DCFTA opportunities during InterAgro in Kiev

OTPL, the Partner Finance Institute of the EU4Business-EBRD Credit Line programme In Ukraine participated in the 13th InterAgro Exhibition in Kiev.   OTPL presented its leasing products under the EU4Business-EBRD Credit Line to farm equipment suppliers as well as users of agricultural equipment.

InterAGRO is the main occasion of the year where innovations in agricultural machinery and equipment as well as related services are showcased.

At the exhibition, the latest developments and innovations for the global and national machine building for agricultural sector are represented, as well as agricultural equipment for repair and maintenance, spare parts, precision agriculture and climate technologies, equipment and technologies for crops growing, agricultural chemistry.

Within the frames of the exhibition, a series of business events will be held, the topics of which is formed with respect to the current issues of the agroindustrial complex, taking into account the latest tendencies of the industry development all over the world. Participants of the international conferences, seminars, round tables will be able to orientate themselves in the whirlpool of the novelties of the sector and understand the directions of the industry development.

The EU4Business-EBRD Credit line is a joint initiative of EU and EBRD to help Ukrainian SMEs finance investments, which enable them to seize the opportunities presented by the Deep and Comprehensive Free Trade Agreement (DCFTA). 

The initiative, consisting of leasing/loan finance and cash-back incentives financed by the EU, is designed to support Ukraine’s SMEs and entrepreneurs in aligning their businesses with EU Directives, helping them reach out to new market opportunities by investing in upgrades of their production processes and services. 

New Corn LLC – Leases new Tractor

New Corn LLC – Leases new Tractor

Approximately 50% of Ukraine’s 603,000 km2 land mas is devoted to agriculture, and Ukraine’s arable land is amongst the finest in the world.  It is therefore not surprising that Ukraine belongs to the largest corn producers in the world and corn exports are an important part of the economy.  Helping producers align with European Directives and improving their cost structure, for example through energy savings, is the dedicated goal of the EU4Business-EBRD Credit Line. New Corn LLC took advantage of this opportunity and leased a new Tractor from the EU4Business-EBRD Credit Line Partner Finance Institution OTPL. The new Tractor corresponds with European regulations and is therefore also fully aligned with energy efficiency standards, resulting in environmental improvements especially regarding CO2 emissions. After the successful project verification, the company received 10% of the loan value as a grant incentive, funded under the EU4Business initiative of the European Union.

Invested in:

  • Tractor New Holland T7060

Loan & Grant:

  • Loan Amount: EUR 64,624.98
  • Grant Amount (10%): EUR 6,462.50

Value Added Benefits:

  • Primary Energy Use Avoided: 53.18 MWh/yr
  • GHG Emissions Avoided: 14.6 t CO2/year;
  • In addition, the investment leads to better Health h& Safety conditions of the workers

EU Directives Met

  • Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency, amending Directives 2009/125/EC and 2010/30/EU and repealing Directives 2004/8/EC and 2006/32/EC Text with EEA relevance
  • Regulation (EC) N. 661/2009 of the European Parliament and of the Council concerning type-approval requirements for the general safety of motor vehicles, their trailers and systems, components and separate technical units intended therefore

Agricultural producer of grains, cereals and fodder plants invests in new farm equipment

Agricultural producer of grains, cereals and fodder plants invests in new farm equipment​

2 October 2017

The Moldovan company SC Marineanca-Agro SRL invested in new tractors and seeders and benefits from reduced fuel consumption, reduced pollutant emissions and moves closer to meeting EU Standards. The company took a EU4Business-EBRD Credit Line loan and, because the equipment chosen was standardized, it chose the fast and simple LET process.  After successful verification, the company received a 10% grant.

Investments in:

  • New Tractor
  • New Seeder
  • Other related tools

Investment volume:

  • Loan amount: EUR 80,813
  • Grant amount (10%): EUR 8,081.3

EU Directives met:

Regulation (EU) 2016/1628 of the European Parliament and of the Council of 14 September 2016 on requirements relating to gaseous and particulate pollutant emission limits and type-approval for internal combustion engines for non-road mobile machinery, amending Regulations (EU) No 1024/2012 and (EU) No 167/2013, and amending and repealing Directive 97/68/EC.

EBRD and EU support OTP Leasing in Ukraine – EBRD Press Release

EBRD and EU support OTP Leasing in Ukraine – EBRD Press Release

12 September 2018

  • EBRD four-year UAH 324 million (€10 million equivalent) loan to OTP Leasing Ukraine
  • Long-term local currency lending to support Ukrainian SMEs
  • Project supported by incentive grant of €1 million under EU4Business initiative

The EBRD is providing a local currency loan of up to UAH 324 million (€10 million equivalent) to OTP Leasing (OTPL) in Ukraine for long-term leases to small and medium-sized enterprises (SMEs) across the country.

SMEs will also benefit from grant funding of up to €1 million available under the European Union’s EU4Business initiative, which helps small firms to invest and benefit from the Deep and Comprehensive Free Trade Area (DCFTA) between Ukraine and the EU. By joining the EBRD programme, which is linked to the DCFTA, OTPL and its clients will also benefit from expert advice in the form of training and support provided by consultants.

The grants will be provided as investment incentives to eligible SMEs to reduce the cost of their capital expenditure on upgrades of technology and production processes in line with EU standards and regulations.

OTP Leasing, a limited liability company incorporated in Ukraine and owned by OTP Bank PLC of Hungary, has been a well-established market player in Ukraine for a decade. The latest EBRD loan will allow OTPL to increase the terms of leases it offers and provide them in local currency. This will enable the leasing provider to diversify its customer base, especially by targeting smaller companies. The use of local currency will shield local borrowers from foreign exchange risks.

EU4Business is an EU initiative that supports private sector in the Eastern Partnership countries, including Ukraine. It aims to improve business climate by offering professional advice and access to financing for small and medium-sized businesses. Support under the EU4Business initiative is provided jointly with other organisations such as the EBRD.

The EBRD is the largest international financial investor in Ukraine. To date, the Bank has made a cumulative commitment of almost €12.1 billion across some 400 projects since the start of its operations in the country in 1993.

Cereals, Wheat, Sunflower, Corn Producer invests in Farm machinery

Cereals, Wheat, Sunflower, Corn Producer invests in Farm machinery

18 May 2018

The Modovan company GT Doina Ioana – Agricultural Company – Cereals, Wheat, Sunflower, Corn

Supporting the competitiveness of the rural communities and agricultural companies is important for all countries, and especially important for Moldova with its important agricultural sector.  The EU4Business-EBRD Credit Line supported the company GT Doina Ioanain, a specialist in the cultivation of cereals, wheat, sunflower and corn, in upgrading its harvesting equipment. The new harvester allows the company to increase its productivity, produce higher quality output and safeguard the health and security of its workers/equipment operators. In addition, the new machine is more energy efficient.  The new harvester was purchased with a EU4Business-EBRD Credit Line loan using the simple LET approach for standardised equipment. After successful project verification, the company received 10% of the loan amount as a grant cashback, funded under the EU4Business initiative of the European Union.

Invested in:

  • New harvester for crop cultivation

Invested Volume:

  • Loan Amount: EUR 78,000
  • Grant Amount (10%): EUR 7,800

EU Directives met:

  • Regulation (EU) No 167/2013 of the European Parliament and of the Council of 5 February 2013 on the approval and market surveillance of agricultural and forestry vehicles
  • Regulation (EC) N. 661/2009 of the European Parliament and of the Council concerning type-approval requirements for the general safety of motor vehicles, their trailers and systems, components and separate technical units intended therefor
  • Directive 2006/42/EC on machinery, and amending Directive 95/16/EC