The State Export-Import Bank of Ukraine (Ukreximbank) has received 20 million euros to help local businesses overcome difficulties and disruptions caused by the war in Ukraine, Europa EU reports.
The European Union provided a grant of €2 million, making it possible to offer more affordable credit terms. The operation includes a parallel cross-currency swap made possible through co-operation with the Currency Exchange Fund (TCX). This approach helps to support long-term lending in Ukrainian hryvnia.
The European Investment Bank (EIB, an EU bank) has allocated EUR 20 million to the State Export-Import Bank of Ukraine (Ukreximbank) as part of the EU’s efforts to promote economic recovery. This local currency funding is aimed at supporting Ukrainian small and medium-sized enterprises (SMEs) and is the last tranche of a €300m debt facility provided by Ukreximbank.
The operation involves a parallel cross-currency swap made possible in collaboration with the Currency Exchange Fund (TCX). This approach supports long-term lending in Ukrainian hryvnia. The transaction benefits from a €2 million grant from the European Union, which makes it possible to offer more affordable loan conditions.
The transaction was made possible by the EIB’s investment in TCX, a development finance institution established to protect borrowers in emerging and frontier markets from foreign exchange risk. TCX offers derivatives in the currencies of developing and transition countries that turn foreign currency loans into fixed local currency liabilities.
This EU contribution is part of the European Union’s wider EU4Business initiative, which aims to stimulate SME growth by improving access to finance, providing business development services and promoting better business regulations.
EIB Vice-President Teresa Czerwińska, responsible for the Bank’s operations in Ukraine, said:
In these extraordinarily challenging times, it’s crucial to enhance vital access to finance for war-affected SMEs, the backbone of the Ukrainian economy, to meet their business recovery needs and support the private sector. The EIB remains dedicated to ensuring Ukrainian SMEs have the support needed for the country’s recovery. We are grateful for the backing by the European Commission, our primary partner in this endeavour, and delighted to strengthen our cooperation with Ukreximbank.
CEO of TCX Ruurd Brouwer added:
We are grateful for the opportunity to support the EIB and the European Union in realising this transaction. Access to sustainable and predictable hryvnia funding is critical for the resilience of SME borrowers in Ukraine. Especially now.
Member of the Management Board of Ukreximbank Oleksandr Schur said:
Today, Ukrainian businesses are undergoing a painful forced transformation. On one hand, European integration processes promise prospects for development in foreign markets and a significant reduction of barriers. On the other hand, a full-scale war has seriously impacted the country’s economy. The loan provided by the EIB signifies a successful partnership between Ukreximbank and the EU bank. We are grateful that the European Union and its bank, the EIB, continue to support us during these challenging times, as this partnership enables us to continue assisting Ukrainian small and medium-sized businesses, which have been the hardest hit by the war.
The EIB and its subsidiary, the European Investment Fund (EIF) – together the EIB Group – provided over EUR 1.6 billion to support the Ukrainian private sector, in particular SMEs, through credit lines and partial portfolio guarantees prior to the war.
The EIB Group (with the support of the European Commission) plans to launch the EU4Business Guarantee Fund to support SMEs in Eastern Partnership countries, including Ukraine. The new facility will be implemented in partnership with local financial intermediaries and will amount to EUR 40 million, of which EUR 30 million will be channelled to Ukraine. The rest will be provided to banks in Azerbaijan, Georgia and Armenia. The facility is expected to mobilise €500 million in loans in the selected countries, including €375 million in Ukraine.
