The European Bank for Reconstruction and Development (EBRD) has signed an agreement with Ukraine’s OTP Bank (Kyiv), approved in early December, to cover up to 50% of the credit risk on the bank’s new EUR200 million loans, the EBRD said in a statement on Monday.
“This is the fifth and largest such loan agreement provided by the EBRD to OTP, building on the successful cooperation between the two institutions to date,” the release said.
It is specified that this will enable the bank to finance critical sectors such as agriculture, energy, manufacturing, and transportation.
The EBRD’s participation in the project, estimated at EUR 60 million, will be supported by first-loss risk coverage funded by donors, including the European Union (EU), under the UIF Ukraine Facility.
It is also noted that, taking into account this project, the total amount of financing under similar EBRD guarantees signed since the beginning of Russia’s full-scale war against Ukraine is almost EUR 2 billion.
Up to 20% of the project’s risk-sharing loans will be used to support long-term investments by private micro, small and medium-sized enterprises (MSMEs) in EU-compliant and green technologies that increase their competitiveness in domestic and foreign markets. Upon completion of the investment projects, these sub-borrowers will receive EU-funded investment grants under the EU4Business initiative, as well as technical assistance. The EBRD has already allocated EUR 66 million in grant support for Ukrainian MSMEs under the EBRD-EU4Business credit line, including EUR 5 million for projects through the TFP.
According to the bank’s website, the guarantees are planned to be provided in three tranches: two in the amount of EUR 22.5 million, each covering EUR 75 million, and one in the amount of EUR 15 million to cover EUR 50 million of the loan portfolio.
According to the National Bank of Ukraine (NBU), as of November 1, 2024, OTP Bank, a wholly owned subsidiary of the Hungarian OTP Bank, ranked 11th (UAH 116.9 billion) in terms of total assets among 62 banks in the country. The financial institution’s net profit for 10 months of last year amounted to UAH 4.82 billion.
Since Russia’s invasion in 2022, the EBRD has lent more than EUR 5.4 billion to Ukraine, including more than EUR 1.6 billion last year.
The shareholder of OTP Bank Plc (Budapest) at a meeting on December 26, 2024 decided to merge OTP Factoring Ukraine LLC into OTP Bank, according to the issuer’s data in the information disclosure system of the National Securities and Stock Market Commission (NSSMC).
“To carry out the state registration of reorganization (termination) of OTP Factoring Ukraine LLC by its merger with OTP Bank JSC,” it says.
According to the National Bank of Ukraine (NBU), as of November 1, 2024, OTP Bank ranked 11th (UAH 78.4 billion) among 62 banks operating in the country in terms of total assets. The financial institution earned UAH 4.82 billion in net profit for 10 months of this year, compared to UAH 5.29 billion for the same period last year.
According to YouControl, OTP Factoring’s revenue in January-September this year amounted to UAH 0.12 million against UAH 0.86 million in the same period last year, but net profit increased to UAH 22.81 million from UAH 14.27 million due to other operating income of UAH 37.55 million.
The company’s capital amounted to UAH 703.86 million at the beginning of October.
A new promotion for the winter holidays for Mastercard cardholders from JSC OTP BANK. Buy gifts for your family and friends, goodies for the New Year’s table and many other goods in the Rozetka online store or mobile application with a 7% discount when paying with a Mastercard from OTP BANK.
In order to take advantage of the offer and purchase goods at a discount, you need to pay for your purchases on the website rozetka.com.ua or in the Rozetka application with any Mastercard from OTP Bank.
Buy goods from the Rozetka seller with a special mark and choose the payment method “-7% discount when paying with a Mastercard from OTP Bank”. The discount will be credited automatically upon payment.
The promotion is valid from December 6 to 22, 2024.
For more details, please follow the link: https://www.otpbank.com.ua/action/rozetka-per7/
JSC OTP BANK and the European Business Association (EBA) in partnership held an offline event for Ukrainian export-oriented companies, as well as all business representatives interested in export opportunities.
“Exporters: Talk & Network” became a platform for discussing the challenges faced by companies in international markets, as well as finding ways to expand exports of Ukrainian goods and services.
In particular, Volodymyr Mudryi, Chairman of the Board of OTP Bank, mentioned programs from international organizations as opportunities for exporters. In his speech, he emphasized that the Bank’s mission today is to build a bridge between global companies and donors represented in Ukraine.
“In order to work in our country, all international organizations need a responsible and reliable partner with a history and a good reputation. Someone with whom you can speak the same language. So, for global companies, we act as a kind of “translator” of the needs that exist in our market. This is one of our missions,” said Mr. Mudryi. He emphasized that OTP Bank was among the first to start cooperation with the EBRD, and now it also has extensive programs with IFC. “In addition, within the framework of cooperation with the USAID Project “Investments for Business Sustainability”, we have closed one program of co-financing for MSMEs on preferential terms ahead of schedule, and recently received the second tranche to support business,” the banker emphasized.
However, in addition to global instruments such as programs with international companies, the Bank also supports exporters in their daily work. According to V. Mudryi, OTP BANK has developed profitable and customized services and products – a separate module “Currency Contracts” in the Click OTPay client-bank system, which has complete information on the status of settlements under export and import contracts, currency SWAP, lending, the “Trading Platform” service, which gives the client the opportunity to fix the exchange rate from 1 cent, and also provides access to the exchange of exotic currencies. “We try to optimize and personalize the work with the Bank for our clients as much as possible, to make it as convenient as possible. To this end, we have set up many processes: for example, any new contract must be processed and confirmed by the Bank on the same day,” said Mr. Mudry.
During the event, he advised entrepreneurs to expand their knowledge of ESG (environmental, social, corporate governance) sustainability standards, which are increasingly required by international organizations from Ukrainian businesses. “It is inevitable and it is already knocking on our door. There are requirements from the EBRD, the World Bank, and the National Bank of Ukraine is also planning to develop its own standards. So now, at the level of the NABU (Independent Association of Banks of Ukraine), we are trying to bring together all the requirements so that there is a common understanding of what we will implement, as well as to develop a schedule for the transition to ESG standards,” said Mr. Mudryi.
Yulia Vitka, Deputy Project Manager, spoke about various programs for exporters and SMEs and the opportunities of the USAID Investment for Business Sustainability Project. Ruslan Gashev, Chairman of the Board of Export Credit Agency, presented ECA’s experience and outlined changes in the Agency’s work that allowed it to expand cooperation with business representatives.
“Exporters: Talk & Network: tools to support export-oriented companies” was the third offline event for exporters that OTP BANK and the European Business Association held in partnership. Previous meetings with business took place in the summer and spring of 2024.
JSC OTP BANK sold domestic government bonds (OVDP) from its own portfolio for UAH 573 million in equivalent to its individual customers through the OTP Bank UA application. This was reported by Valeria Ovcharuk, product owner of OTP Bank.
“The bank offers ample opportunities to purchase government securities and allows you to choose the optimal bond rate and maturity. You can buy government bonds in the app at any convenient time. This is an effective tool that allows not only to support the financial stability of Ukraine in times of war, but also to diversify your savings and receive additional income in both hryvnia and foreign currency,” said Ms. Ovcharuk.
The service is available in the OTP Bank UA application to all individuals who have opened a securities account in any branch of the Bank. The easy-to-use interface allows you to make a reliable and profitable investment in your future in just a few clicks, as the repayment of government bonds is 100% guaranteed by the state.
In total, since the beginning of 2024, OTP Bank’s individual clients have purchased government bonds for almost UAH 3.7 billion.
It should be reminded that the service of purchasing government bonds from its own portfolio in the OTP Bank UA application was launched at the end of May 2024. At the same time, the Bank allows its customers to buy bonds directly at auctions of the Ministry of Finance through the app.
To learn more about investing in domestic government bonds, please follow the link.
The USAID Business Sustainability Investment Project has awarded a second grant of $2.76 million to OTP Bank (Kyiv) to expand access to finance for micro, small and medium-sized enterprises (MSMEs), the bank’s website reports.
“More than 100 companies have already been financed under the first tranche. The new tranche of $2.76 million will bring the total grant amount to $4 million. The funds will be used to compensate for part of the interest rate for borrowing companies,” the website says.
It is noted that the grant program provides for business lending at an interest rate of 9.9% per annum in the first year of the loan agreement, and the difference with the market rate will be compensated by grant funds.
In the second year and thereafter, clients are obliged to pay interest on the use of credit funds at the rate of UIRD3m+5% per annum.
Under the terms of the program, micro, small and medium-sized enterprises with annual revenues of up to EUR 50 million and up to 250 employees belonging to one of the following target groups: relocated or affected by hostilities, companies in critical industries, and companies with female co-owners can receive financing on such terms.
The maximum loan amount that a company or a united group of companies can apply for is UAH 20 million, and the minimum is UAH 1 million.
“The grant program also applies to factoring agreements, under which the bank’s clients can receive up to 90% of the cost of supplies in the amount of UAH 2 million to UAH 20 million. Special conditions will apply to agricultural producers if they use the funds received under the grant program to purchase products from OTP Agro Factory’s partners,” the press release said.
The press service reminded that during the first stage of the program, which started in 2023, more than 100 Ukrainian enterprises were provided with financing.
According to the National Bank of Ukraine (NBU), as of July 1, 2024, OTP Bank ranked 11th (UAH 114.55 billion) in terms of total assets among 62 banks in the country. The financial institution’s net profit for 2023 amounted to UAH 3.71 billion.
