Financing of small and mid-sized business by Ukrgasbank under the agreement between Ukraine and the State Investment Bank – Supervisory Board (NS)

In the summer of 2015, the parliamentarians sealed an agreement between Ukraine and the European Investment Bank. This project involves the obtainment of loaned funds for lending support to the private sector of the domestic economy. The realization of the joint convention, known as the “Primary loan for SMEs and companies with average capitalization” implied the direct participation of Ukrainian banks that will become the mid-tier in the process of disposition of allocated funds which involves the investments in the amount of 400 million euros. Ukragasbank is directly involved in this promising investment project between Ukraine and EIB.

Only national financial institutions that have passed the special qualification stage will participate in this project. On October 5, 2017, the Ministry of Finance of Ukraine signed a series of agreements with the selected banks, including Ukrgasbank. According to the terms of this agreement, this financial institution will receive funding in the amount of 50 million euros. The entrepreneurs will be able to use these funds to accommodate their mid-term and long-term requirements, as well as for the mid-term replenishment of the working capital.

Kyrylo Shevchenko, the chairman of the board at Ukrgasbank, says that this particular loan program is immensely important and promising both for the clients of the financial institution in which he holds the key position, as well as for the national economy in general. At the same time, the banker lays special emphasis on the possibility of financing “green” projects within the framework of this agreement. These projects are associated with the enhancement of energy efficiency and the renewable energy.

The agreement regarding the credit provision for SMEs was signed by three parties: the Ministry of Finance, Ukrgasbank, and Ukreximbank, the official agent appointed by the Ministry of Finance. According to this agreement, the funds will be allocated in the form of sub-loan with reduced interest rates granted for the development of the local private sector as well as the national infrastructure.

According to Mr. Shevchenko, the small and mid-sized businesses have significant potential. The companies in this particular segment possess sufficient reserves to give an incentive for the sustainable growth of the domestic economy. Therefore, Ukrgasbank is ready to provide its clients with the extended range of services and special credit terms. The representatives of the SME are most interested in the long-term funding that will provide an opportunity to expand their businesses and make them more efficient. The management of Ukrgasbank understands it and is poised to find the way to accommodate the entrepreneurs’ requests. For instance, more than 46 thousand customers across the country have already received funding that allows them to grow their businesses. All in all, the representatives of the SME segment have received around UAH 1.7 billion in loans from this particular financial institution, 800 million of which were allocated for the eco-projects, including the modernization of heating facilities.

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