Business news from Ukraine

PrivatBank puts up for sale consumer loan portfolio worth UAH 501.4 mln

State-owned PrivatBank (Kyiv) offers professional market participants through the OpenMarket platform (SE SETAM) to purchase at a Dutch auction (with a price reduction) the rights to claim a loan portfolio of more than 80 thousand consumer loans at a starting price of UAH 501.4 million.

“This portfolio includes more than 80 thousand unsecured consumer loans granted to individuals, which were recognized as uncollectible and written off against provisions. The portfolio for sale excludes loans for which the debtors are mobilized servicemen – according to information available to PrivatBank,” the press service of the state bank informs.

It is noted that the rights of claim on such a portfolio include only the loan principal and accrued interest.

The sale will be carried out by gradually reducing the starting price of the lot, while the minimum selling price, according to the published terms, is 2.1% of the initial price – UAH 10.53 million.

According to the state bank, only financial institutions that have a valid license to lend money or provide factoring services and meet the bank’s requirements will be allowed to participate in the auction. Applications for participation can be submitted until February 2, and the auction itself will take place on the 23rd of the same month.

According to the National Bank of Ukraine, as of November 1, 2023, PrivatBank ranked 1st in terms of assets (UAH 804.14 billion) among 63 banks operating in the country, and 2nd in terms of the number of branches (1131).

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OTP Bank to provide UAH 200 mln loan to Concern Khlibprom

OTP Bank (Kyiv) has signed a loan agreement with Concern Khlibprom PJSC, part of OKKO Group, for UAH 200 million for a three-year period to replenish working capital, the financial institution said in a release on Monday.

“Financing of food industry enterprises is currently one of the priority areas for the development of OTP Bank’s corporate business. The agreement with Concern Khlibprom is another confirmation of the successful implementation of this strategy,” Alla Biniashvili, a member of the Management Board of OTP Bank, said in the statement.

There is no information on the cost of the loan and its other terms.

According to the release, Concern Khlkbprom is one of the largest enterprises in the Ukrainian bread market, producing over 160 tons of bread, bakery, confectionery, and semi-finished dough and coffee products daily. The company’s structure includes five production units with a total staff of over 3000 employees.

In particular, the company’s products are represented on the Ukrainian and international markets by such brands as Agrola, Vinnytsiakhlib, Bandinelli, TM 2GO, Grill & Bakery, and Ljubljana. Khlibprom also owns its own coffee brand Harmony Sentivi.

“In 2022, Concern Khlibprom increased its net profit by 23.7% to UAH 21.1 million on revenue growth of 15.4% to UAH 1 billion 702.1 million, and its assets grew by 8.4% to UAH 920.3 million. Long-term liabilities increased by 1.2% to UAH 270.2 million, while current liabilities increased by 16.5% to UAH 327.7 million.

Effective interest rates on hryvnia loans ranged from 13.31% to 15.95% at the beginning of this year.

OTP Bank, a wholly owned subsidiary of the Hungarian OTP Bank Plc, was 10th among 63 Ukrainian banks in terms of total assets (UAH 103.14 billion) as of the beginning of October 2023.

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Ukrgasbank concludes new loan agreements for UAH 110 mln with Ukrcable

State-owned Ukrgasbank has signed new loan agreements under the state program “Affordable Loans 5-7-9%” for UAH 110 million with Ukrcable Group, a leading cable manufacturer in Ukraine, the financial institution’s press service reports.

“Loan funds totaling UAH 110 million will be used to conduct current business activities, including the purchase of raw materials and supplies for the production of cable and wire products and the rhythmic loading of new equipment, which was also partially financed by the bank,” the statement said.

It is noted that the agreements were concluded as part of the continuation of the 3-year cooperation under the state program.

The bank notes that Ukrcable Group companies actively cooperated with the Kotsiubyno village council, Irpin city council and several military units both during the occupation of Kyiv region and during the recovery.

According to the bank, Ukrcable actively cooperates with electricity producers and suppliers to provide electricity to the population during power outages across the country.

According to the company’s website, Ukrkabel LLC (Kotsiubynske, Kyiv region) is capable of producing 150,000 km of cable per year, with a total area of 60,000 square meters, including 28,000 square meters of production capacity. According to OpenDataBot, the ultimate beneficiaries are Volodymyr Dovbenko (33.34%), as well as Halyna Bondar and Oleh Melnyk (33.33% each).

According to the National Bank of Ukraine, as of September 1, 2023, Ukrgasbank ranked 4th in terms of total assets (UAH 168.6 billion) among 64 banks operating in the country, with net profit for the first half of the year amounting to UAH 2.6 billion.

In the third quarter, the state-owned bank’s network decreased by one branch and now includes 218 structural units across the country.

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ECA insured UAH 50.5 mln of exporters’ loan agreements

In September, the Export Credit Agency (ECA) insured exporters’ loan agreements worth UAH 50.5 million, according to the ECA website.

It is specified that the volume of supported exports for the month amounted to UAH 162.8 million.

The most popular categories of goods for export in September were (by foreign economic activity groups) processed vegetables, ferrous metal products, and finished products made from grain, flour, starch, and milk, while the counterpart countries were Poland, the Czech Republic, the Netherlands, Germany, and Lithuania.

The top three partner banks were Ukrgasbank (UAH 71.1 million of supported exports and UAH 21.9 million of financing), Oschadbank (UAH 52.8 million and UAH 20.6 million), and Kredobank (UAH 38.9 million and UAH 8 million), respectively.

This year, Ukrgasbank ranks first (UAH 1.35 billion of exports supported and UAH 159 million of loans disbursed), Raiffeisen Bank is second (UAH 605 million and UAH 210 million), and Oschadbank is third (UAH 584.7 million and UAH 128.67 million).

In September, entrepreneurs from Ivano-Frankivsk region were the most active in insuring their loans received under export contracts with the ECA (the amount of contacts amounted to UAH 51.5 million and the amount of loans was UAH 11.9 million), Dnipropetrovs’k region (UAH 38.9 million and UAH 8 million), Ternopil region (UAH 29.24 million and UAH 18.3 million), Zakarpattia region (UAH 23.55 million and UAH 2.3 million), and Rivne region (UAH 19.63 million and UAH 10 million).

In the first nine months of this year, ECA and its partner banks found the largest number of customers in Kyiv (UAH 311.27 million of insured loans), as well as in Dnipropetrovska (UAH 53.63 million) and Vinnytska (UAH 10.5 million) regions.

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Nibulon has agreed on loan restructuring with OTP Bank

One of the largest grain market operators in Ukraine, JV Nibulon LLC (Mykolaiv), has agreed to restructure its loan agreement with OTP Bank, the grain trader’s press service reported on Facebook.

“We are grateful to the bank for the speed of decision-making and constructive approach in resolving the issue of restructuring the company’s financial obligations in such difficult times for the Ukrainian economy,” said Iryna Levkivska, CFO of the grain trader.

At the same time, Nibulon noted that the addition of another bank with foreign capital to the proposed restructuring terms once again emphasizes the confidence of foreign financial institutions in the company and Ukrainian business in general.

As reported earlier, Nibulon agreed with Kredobank to restructure the terms of the loan agreement, which was extended for six years with a preferential interest rate and deferred repayment of the principal. A similar agreement on loan prolongation for 6 years was reached with Creditwest Bank Ukraine (JSC West Finance and Credit Bank). An agreement on long-term restructuring of financial liabilities was signed with JSB Ukrgasbank.

JV Nibulon LLC was established in 1991. Prior to the Russian military invasion, the grain trader had 27 transshipment terminals and crop reception complexes, a one-time storage capacity of 2.25 million tons of agricultural products, a fleet of 83 vessels (including 23 tugs), and owned the Mykolaiv Shipyard.

“Before the war, Nibulon cultivated 82 thousand hectares of land in 12 regions of Ukraine and exported agricultural products to more than 70 countries.

In 2021, the grain trader exported the highest ever 5.64 million tons of agricultural products, reaching record volumes of supplies to foreign markets in August – 0.7 million tons, in the fourth quarter – 1.88 million tons, and in the second half of the year – 3.71 million tons.

Nibulon’s losses from Russia’s full-scale military invasion have reached $400 million. The grain trader is currently operating at 30% of capacity and has set up a special unit to clear agricultural land of mines.

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Oshchadbank granted loan of UAH 250 mln to Tavria B network

State-owned Oschadbank provided a UAH 250 million revolving credit line to Tavria Plus, a private enterprise (PE) that is part of the Tavria B retail chain, in August as part of the state program “Affordable Loans 5-7-9%,” the financial institution’s website reports.

“During the period of full-scale war, we have already signed five loan agreements with this retail chain totaling UAH 865 million,” said Yuriy Katsiyon, Deputy Chairman of the Board of Oschadbank in charge of corporate business.

Vyacheslav Pysmenyuk, director of Tavria Plus, noted that by combining different types of credit support, they managed not only to balance payments with suppliers but also to further develop the network.

It is noted that Oschadbank has been cooperating with Tavria Plus since 2014. In addition, during 2022-2023, the company additionally received support from the state bank on general terms.

The state bank clarified that the credit line for Tavria B was the third such line for retailers under the state program “Affordable Loans 5-7-9%”. Their purpose is to replenish working capital. The total amount of funding provided by the state program during the full-scale war amounted to UAH 580 million.

According to the retail chain’s website, Tavria V has been operating since 1992 and includes 135 supermarkets and shopping centers, meat and fish processing plants, confectioneries, culinary shops, bakeries, a brewery, garment and knitwear production, and a large logistics center. The chain employs 4,500 people.

According to Opendatabot, the ultimate beneficiaries of Tavria-V LLC are Boris and Mikhail Muzalev, with 60% and 40% of the company’s shares, respectively.

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