Business news from Ukraine

Business news from Ukraine

Ukrainian banks plan to increase lending in 2024 – survey

Commercial banks in Ukraine in 2024 will focus on the implementation of their programs of car loans, mortgages and lending to small and medium-sized businesses.

This opinion was expressed by Elena Dmitrieva, First Deputy Chairman of the Board of Globus Bank, in her comments to Interfax-Ukraine.

“Significant reduction of the discount rate in 2023 from 25% to 15% allowed banks to attract cheaper resources, restore credit programs frozen by the war and introduce fundamentally new areas of lending. Under the most favorable economic conditions in 2024, we should expect further reduction of the discount rate to 14-12%. As a consequence, in 2024 (at banks) the reduction of rates depending on the type of loan, the term of its payment and down payment may be from 2% to 4%,” – said Dmitrieva.

She recalled that since the second half of the year, the average reduction in interest rates on bank loans depending on the term of repayment and the size of the down payment has already amounted to 4%. In particular, rates on mortgage loans have fallen by an average of 3% (mainly we are talking about loans under partnership programs of developers and banks in the primary housing market), rates on car loans for new cars have fallen by 3-5%, and rates on consumer loans for the purchase of consumer goods have fallen by an average of 4%.

“The request of citizens for one or another type of credit on acceptable terms is almost inexhaustible. In 2024, any positive changes in credit conditions will be predetermined solely by economic factors,” emphasized Elena Dmitrieva.

In 2024, an important component of credit development will remain the participation of commercial banks in the implementation of a number of government credit programs, such as lending to small and medium-sized enterprises “5-7-9”, “Affordable factoring” (collateral-free financing for micro, small and medium-sized businesses with deferred payment at a compensatory rate of 13% per annum for up to 360 days), programs for energy modernization of houses “Energodom”, preferential mortgage “eOsel”, as well as the development of special compensatory programs with local authorities to reimburse a part of the loan amount.

In particular, the Globus Bank under the Energodom program expects to issue loans for more than UAH 200 million, of which more than 70% will be for partnership programs for reimbursement of condominiums’ expenses.

Dmitrieva predicts a gradual transformation of the state preferential programs “5-7-9” and “eOsel”. In particular, the “5-7-9” program will be gradually extended to regions with high military risks and will concern those industries that have not yet recovered from the very beginning of the full-scale invasion.

“The state budget for 2024 envisages more than UAH 18 billion for compensation of interest rates of the “5-7-9” program. However, most of these funds may go to repay the debt of the program manager – the Entrepreneurship Development Fund, because the debt to banks participating in the program is already up to UAH 5 billion. We expect that “5-7-9″ will be significantly narrowed, and loans under the program will be more point”, – said Dmitrieva.

At the same time, according to her assessment, the share of investment loans will gradually increase – for the purchase of fixed business assets (special technical means, motor vehicles, medical transport, production equipment, etc.). “It is expected that the share of such loans will make up to 30% of all loans issued,” Dmitrieva said.

The effectiveness of the eOsela soft mortgage program next year will depend on the volume of financing and popularization of the program among housing developers (activation of the program in residential projects at the construction stage).

Dmitrieva noted that compared to June 2023, when more than 490 mortgages were issued, the program’s activity has almost doubled (currently, about 800-900 loans are issued monthly), but it is extremely important to increase the program’s activity by at least 1.5 times, to 1.4-1.5 thousand loans per month, in 2024.

It is important to increase the number of financial institutions that are partners of the program, which will allow a wider range of citizens to take advantage of the preferential mortgage, as well as increase the “weight” of lending in the portfolio of commercial banks (currently, 7 commercial banks participate in the program), as well as intensify lending to facilities under construction, as well as expanding to townhouses and private houses.

According to her estimates, it is possible to increase from the current 1% to 25% the share of loans issued under the aHouse program for the purchase of housing under construction, but for the preferential mortgage to work in the primary market, the will of the developers themselves is needed, as well as the reformatting of their sales systems to meet legislative innovations to protect the rights of investors-buyers of housing.

“18 developers have already been accredited to participate in the eHouse program, which builds only 3-5% of the number of objects whose construction began before the full-scale invasion and continues in a slow mode, but without signs of “frozen” construction. We expect that in 2024 the number of residential complexes under construction accredited to participate in the program will increase by at least 2-2.5 times. After all, this is a direct investment in further construction, in the development of the industry in general, which is very important during the war,” summarized Dmitrieva.

Globus Bank was registered in 2007. According to the NBU, as of April 11, 2023, the bank’s shareholders were Elena Silnyagina (100%), Dmitry Polkovsky (16.198866%), Yevgeny Varyagin (9.899307%), Sergey Mamedov (9.899307%), Andrey Pinchuk (9.899307%) and Taras Lisovoy (3.599748%), who indirectly own the authorized capital.

According to the National Bank of Ukraine, as of September 1, 2023, Globus was ranked 24th (UAH 9.07 billion) among 60 banks operating in the country in terms of total assets.

In 2022, Marganetsky GOK increased its loss by 1.9 times

In 2022, PrJSC Marhanets Mining and Processing Plant (MGOK, Dnipro region) increased its net loss by 1.9 times year-on-year to UAH 47.062 million.

According to the company’s annual report in the information disclosure system of the National Securities and Stock Market Commission (NSSMC), net income for the period decreased by 63.8% to UAH 1 billion 434.670 million.

Retained earnings by the end of 2022 amounted to UAH 563.731 million.

In 2022, MMPP produced 271,825 thousand tons of manganese ore, 51,284 thousand tons of concentrate, 219,937 thousand tons of sludge, and sold 237,539 thousand tons of ore, 59,539 thousand tons of concentrate, and 219,937 thousand tons of sludge.

As reported, in the first half of 2022, MMPP increased its net loss by 4.3 times compared to the same period last year – up to UAH 42.164 million, net income decreased by 23.6% to UAH 1 billion 138.683 million.

In January-March 2022, MMPP increased its net loss by 16.6 times compared to the same period in 2021 to UAH 159.870 million, while net income increased by 2.4 times to UAH 865.275 million.

MMPP ended 2021 with a net loss of UAH 24.541 million, while in 2020 it made a net profit of UAH 239.284 million.

MMPP is developing the eastern part of the Nikopol manganese ore deposit (Hrushevsko-Basansky area). The plant comprises four operating mines, including one under construction, one open pit mine – Hrushevsky – and a processing plant.

According to the third quarter of 2023, the largest shareholders of the company are Couttenmax Holdings Limited, Mosfilia Investments Limited and Humax Enterprises Limited, which own 23.8933% of the company’s shares each, as well as Fianex Holdings Limited (all of Cyprus), which owns 24% of the company’s shares.

The authorized capital of MMPP is UAH 366.625 million, with a share price of UAH 0.25.

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Commissioning of housing in Ukraine, mln sq m

Commissioning of housing in Ukraine, mln sq m

Source: Open4Business.com.ua and experts.news

Energoatom increased revenue from electricity sales by 30%

In 2023, NNEGC Energoatom increased its revenue from electricity sales by 30% (by UAH 44 billion) compared to last year – up to UAH 190.7 billion, the company reported on its Telegram channel.

“Of these funds, more than UAH 124.4 billion was paid as part of the PSO, or in other words, to maintain low tariffs for the population,” the company said in a statement.

The company’s revenue quadrupled from 2020 (UAH 48.1 billion) to 2023. At the same time, over the same period, the growth in the cost of electricity production amounted to 26.6%.

In 2024, NNEGC plans to increase its revenue by one third compared to the current year – up to UAH 253.3 billion.

“Despite wartime, a significant reduction in electricity consumption and the loss of capacity at the temporarily occupied Zaporizhzhya NPP, we managed to implement a set of measures to improve the economic efficiency of Energoatom’s operations. This is what allows the state to maintain low electricity tariffs for the population,” NNEGC President Petro Kotin said in a statement.

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Sukhaya Balka mine reduced output of commercial ore by 36.5%

Sukhaya Balka mine (Krivoy Rog, Dnepropetrovsk region), which is part of DCH Group of Oleksandr Iaroslavskyi, produced almost 931 thousand tons of commercial ore by the end of 2023, said Vitaly Bash, General Director of DCH Steel of DCH Group, in his address to employees on the eve of the New Year, published in the corporate newspaper of DCH Steel on Thursday.

According to him, for the second year in a row there is a full-scale war in the country, and the company has to overcome wartime difficulties. For example, almost 1,000 employees of the group’s companies are now at the front, so the workforce is under constant strain.

“But despite the numerous crises – energy crisis, water shortage, lack of qualified personnel – DMZ and the Sukhaya Balka mine continue to work. At the mine, 2023 can be called the year of the most frugal use of resources: at the industrial sites we restored the equipment, continued the implementation of the program to modernize the equipment,” – stated the General Director.

At the same time, he reminded that in April the fleet of technological transport was replenished with four new loading and delivery machines with bucket size of 1 cubic meter and 0.6 cubic meter. Renewal of mine skips of the Yubileynaya mine is next in line.

“In September we resumed mining at the mine named after Frunze. Frunze, which was suspended due to constant shelling of the energy infrastructure in November 2022. The coordinated work of employees of all mine divisions contributed to the production of almost 931 thousand tons of commercial ore in 2023,” the CEO said.

The head of the company also said that production activities at DMZ have intensified: starting from spring, production at the coke and chemical site has increased. Rolling shops have been conducting campaigns for the whole year for the production of mine stand, mine rails, channels and angles from toll billets. Much attention was paid to repairs, which were mainly performed by our own forces. Also, the repair departments have successfully mastered the manufacture of parts and some spare parts for the DMZ and colleagues.

“I look forward to an improvement in the situation in the country and the mining and metallurgical industry so that the enterprises can work at full (utilization – IF-U),” Bash said.

In the company to the agency “Interfax-Ukraine” specified the volume of ore production by the mine “Sukhaya Balka” in 2022, as earlier this figure was not made public – 1.469 million tons.

DMZ specializes in the production of steel, pig iron, rolled steel and products from them. On March 1, 2018, DCH Group signed an agreement to purchase Dniprovsky Steel Works from Evraz.

Sukhaya Balka mine is one of the leading mining companies in Ukraine. It extracts iron ore by underground mining. The mine includes the Yubileynaya and Frunze mines. Frunze.

DCH Group acquired the mine from Evraz Group in May 2017.

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Oil is moderately rising, Brent near $77.6 per barrel

Oil prices are moderately rising on Friday morning after a sharp decline in the previous session.

The price of March futures for Brent on the London ICE Futures exchange by 7:09 a.m. is $77.59 per barrel, which is $0.44 (0.57%) higher than at the close of the previous session. On Thursday, these contracts fell by $2.39 (3%) to $77.15 per barrel.

Quotes for February futures for WTI in electronic trading on the New York Mercantile Exchange (NYMEX) by this time increased by $0.31 (0.43%) to $72.08 per barrel. At the end of the previous session, they fell by $2.34 (3.2%) to $71.77 per barrel.

Analysts say the main reason for the drop in oil prices on the eve of the previous day is the reduction of fears about attacks by Yemeni Houthis on transport vessels. In particular, on Wednesday, the Danish transport and logistics company A.P. Moeller-Maersk AS announced the resumption of transportation through the Red Sea after the implementation of an international mission to ensure security in the region.

“Oil prices have fallen as global transportation giants prepare to resume navigation in the Red Sea despite attacks by Houthi rebels,” wrote Stephen Innes, managing partner of SPI Asset Management. – “It’s a calculated risk and a bet on the success of the international security mission.

The quotes could not be supported by the data on oil and oil products stocks in the United States published the day before.

Commercial oil reserves in the United States last week fell by 6.911 million barrels, while analysts on average had forecast a decline of 2.7 million barrels, according to Trading Economics. The decline in stocks was a record for four months.

Stocks at the Cushing terminal, where NYMEX-traded crude is stored, increased by 1.508 million barrels. This is the tenth consecutive week that Cushing stockpiles have increased, which has not been seen since 2016.

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