EBRD provides Raiffeisen Bank with risk coverage guarantee to support EUR 100 million in energy investments

The European Bank for Reconstruction and Development (EBRD) continues to support energy security in Ukraine by providing Raiffeisen Bank of Ukraine (RBU) with an unfunded portfolio risk sharing guarantee, which will enable energy investments totaling EUR 100 million.

This is stated in a message by the EBRD, the Ukrainian News agency reports.

RBU has become the fourth bank after Ukrgasbank, PrivatBank and Oschadbank to join the EBRD’s landmark Energy Security Support Facility (ESSF) program, which is being implemented in the Ukrainian financial sector to expand access to financing for investments that are critical to the country’s energy security.

The EBRD portfolio guarantee provided under the ESSF will partially cover the risk associated with new sub-loans totaling EUR 100 million that the RBU will provide to eligible micro, small and medium-sized enterprises (MSMEs), as well as corporate and residential clients, for the implementation of decentralized energy generation, energy storage and energy efficiency projects to ensure Ukraine's energy security.

All sub-borrowers under the ESSF will also be able to receive technical assistance during the preparation and implementation stages of their investments.

At least 70% of the sub-loans will be used to support projects that meet the criteria of the Green Economy Transition (GET) approach.

Up to 20% of the total sub-loans will be used to finance long-term capital investments by MSMEs in upgrading their technologies and equipment to European Union standards under the EU4Business-EBRD Credit Line.

Eligible sub-borrowers will also receive EU-funded technical assistance and grant support.

Sub-borrowers in the housing sector (households and condominiums) will receive up to 2% of the total investment under this project and will also have access to grant support financed by the EBRD’s Crisis Response Special Fund (CRSF).

Grant support for eligible sub-borrowers will cover 10-30% of the value of their ESSF-financed investments.

More significant incentives will be offered to companies and households that have suffered the most negative impacts of the war in Ukraine (damage or loss of assets, relocation, etc.), as well as to sub-borrowers that facilitate the reintegration of veterans, people with disabilities and IDPs, and/or to sub-borrowers located in the regions of Ukraine most affected by the war.

The EBRD guarantee is supported by guarantees of partial coverage of the risk of first loss provided by France and the European Union under the Ukraine Investment Framework (UIF).

As the Ukrainian News agency earlier reported, the European Bank for Reconstruction and Development (EBRD) has approved a loan for the Naftogaz of Ukraine National Joint-Stock Company for the purchase of natural gas for the next two heating seasons in the amount of up to EUR 270 million.