The European Bank for Reconstruction and Development (EBRD) has signed a EUR50 million loan agreement with Ukraine’s state-owned Ukreximbank, the loan funds will be used to finance private clients and municipalities.
“Ensuring uninterrupted financing through time-tested partner financial institutions such as Ukreximbank despite the war so that the private sector and municipalities can continue to operate, provide services and support the country is a priority for the EBRD in Ukraine,” EBRD Managing Director for Eastern Europe and the Caucasus Matteo Patrone said in a release Friday.
It is specified that the EBRD’s special crisis response fund covers the risk on the EUR25 million loan.
“During the war and post-war reconstruction phase, it is very important for Ukreximbank’s clients in priority sectors to have access to investment, commercial financing and war risk coverage. The new EBRD financing will certainly contribute to greater sustainability and adaptability of the Ukrainian economy,” said in turn Oleksandr Shchur, a member of the supervisory board of Ukreximbank.
According to the National Bank of Ukraine at the beginning of May, Ukreximbank with total assets of 275.46 billion UAH is the third largest Ukrainian bank among 65 operating in the country.
State-owned Ukreximbank (Kiev) has put up for auction the claim for the unfinished Sky Towers complex in the center of Kiev at a starting price of UAH 5.580bn.
The auction will be held according to the Dutch model (with price reduction) on May 11 at OpenMarket (SE “SETAM” of the Ministry of Justice).
An attempt to sell the asset had previously been undertaken by the state bank in November 2021 with a starting price of UAH 7.145 billion.
The bank report emphasizes that this is an offer “for an ambitious investor, ready to put an end to the epic of one of the most famous construction projects in the city”, specifying that the 47-storey complex of 223 th sq.m. is completed only up to 28 floors.
It should include two towers of 47 and 34 floors, office and retail premises, 8-level underground parking lot for 900 cars built on the land plot of 0,74 ha located in Sholudenko Street which was also mortgaged by the bank.
It is noted that additional liquid security is the array of 60 land plots with a total area of more than 80 hectares, located within Zazimskiy rural council of Brovarskiy district of Kyiv region.
Also pledged to the bank were property rights for design-bidding and design-budget documentation for building of a community center, and a 100% share in the authorized capital of a debtor legal person.
The possibility of transferring to this facility of the capital mayor’s office was discussed in early 2018 by the Kiev Investment Agency, the completion was estimated at $370 million. At the start of the project was estimated at $512 million.
As reported, Sky Towers on Pobedy Avenue, 13 could become the first Ukrainian skyscraper higher than 200 m (projected height of 214 m). The construction was carried out up to 2015, but reached 28 floors with a design height of 47, after which it was stopped. According to the director of the development company “Agency of Office Construction” Alexander Demin, preservation of the object was not carried out.
Credit agreement with Ukreksimbank was concluded in 2007. In May 2012, the KDD Group, which has fallen into a difficult financial situation, signed an agreement to sell the American Cimbrorum Holdings LLC for $ 202.4 million project Sky Towers and the residential complex “Zazimye. Of this amount, KDD was to receive $12 mln in cash, while the rest was obligations, including $168.4 mln to Ukreximbank. At the same time, the bank increased the credit line for the completion of Sky Towers to $193 million, and the borrower was the Office Construction Agency.
In 2019, the parties signed a financial restructuring plan, but the developer continued to default. The Economic Court of Kyiv in early 2021 satisfied the claim of Ukreximbank to recover from the Agency of Office Construction 5.95 billion UAH of the debt on the loan to finance the construction of Sky Towers.
According to the Unified State Register of Legal Entities and Individual Entrepreneurs, the founder of the Office Construction Agency LLC with registered capital of UAH 442 million is the American Taccadero Trading Limited, with David Israel as the ultimate beneficiary.
Ukreximbank was founded in 1992, and the only owner is the state.
According to the National Bank of Ukraine, as of November 1, 2022 Ukreximbank in terms of total assets ranked third (267.423 billion UAH) among the 67 operating in the country.
State Ukreximbank (Kiev) on March 21 signed an agreement with the Entrepreneurship Development Fund (EDF) to attract on three programs to support Ukrainian enterprises 250 million UAH, the press service of the bank reported on Tuesday.
According to the message, credit resources for Ukreximbank will be provided at the expense of both own funds of the FRD, and the means of the project “SME support”, funded with the support of the German government through the German Development Bank KfW and the EU within the initiative EU4Business.
It is indicated that a significant portion of credit funds is planned to support the financing of small and medium-sized enterprises engaged in export operations, which will contribute to the expansion of national production in world markets.
Ukreximbank was founded in 1992. The only owner of this financial institution is the state.
According to the National Bank of Ukraine, as of November 1, 2022 Ukreximbank by total assets was in 3rd place (267.423 billion UAH) among the 67 operating in the country.
The European Bank for Reconstruction and Development (EBRD) may lend state-owned Ukreximbank up to EUR50 million to finance private corporate clients and municipalities in Ukraine affected by the war.
“The loan will provide Ukreximbank with much-needed medium-term financing during wartime and will allow the bank to support its private corporate clients and municipalities using its strategic focus, proven experience in corporate lending to critical sectors and strong regional presence,” the bank said in a statement Wednesday.
According to it, the project will be supported by donors: EUR25 million of first-loss risk coverage will be provided by the EBRD’s Special Crisis Response Fund as part of the EBRD’s special Ukraine War Response Package.
Ukreximbank was founded in 1992. The sole owner of the financial institution is the state.
According to the National Bank of Ukraine, as of July 1, 2022 Ukreximbank in terms of total assets ranked third (228.608 billion UAH) among 68 operating banks in the country, or about 10% of total assets of the banking system.
The bank has 51 branches across the country and two representative offices in London and New York.
Export-import bank SAUDI Exim Bank (Saudi Arabia) will provide state-owned Ukreximbank (Kyiv) with $ 25 million in financing as the first stage of support for importers of Saudi goods, services and products in the Ukrainian and neighboring markets.
The framework agreement signed on October 13 during the Berne Union’s Annual General Meeting in Budapest (Hungary) is the first in the history of Ukreximbank to be signed with Saudi Arabian banks, the Ukrainian bank said.
“The beginning of our cooperation with SAUDI Exim Bank will give impetus for the further development of international cooperation between Ukraine and the Kingdom of Saudi Arabia, will contribute to the implementation of joint projects in various sectors of the economy and the strengthening of trade ties, which have been developing intensively in recent years,” deputy chairman of the bank’s board Oleksandr Schur said.
Earlier in August, SAUDI Exim Bank CEO Saad Alkhalb announced the approval of more than 80 funding requests for 9 billion Saudi riyals (about $ 2.4 billion) for more than 46 countries over the course of the year to fill funding gaps and reduce export risks for Saudi products in the world. All these decisions were made as part of the implementation of Saudi Vision 2030, which provides for reducing the dependence of the economy of Saudi Arabia on oil, according to the Ukraine in Arabic online edition.
According to the information on the official website, SAUDI Exim Bank was established in 2020 and is the state export agency of the Kingdom of Saudi Arabia. The bank focuses on building capacity in high-growth industries, improving Saudi Arabia’s trade balance and strengthening the economy in non-oil industries, and provides exporters with the opportunity to promote the development and diversification of Saudi Arabia’s non-oil exports.
Source: Ukraine in Arabic
JSC Ukreximbank did not find any facts of terrorist financing when issuing a loan of $60 million to companies whose beneficiary is a citizen of Ukraine with the status of an internally displaced person, Serhiy Briukhovetsky, acting chairman of the bank’s board Serhiy Yermakov said. “At the time the loan was issued, the borrower, Mr. Briukhovetsky, went through the proper KYC verification procedure, within which the bank did not reveal information that would indicate the existence of criminal cases and proceedings in connection with the fact of holding shares in the company, including registered in uncontrolled territories,” he said at a press briefing at the Interfax-Ukraine agency.
For clarification, the bank received the client’s consent to disclose information that may constitute banking secrecy, Yermakov added.
According to the bank, as part of the check of the borrower, it was revealed that Briukhovetsky owns the corporate rights of three companies registered in the territory not controlled by Ukraine: Gorspetslift (50%, Horlivka), Dikon LLC (24%, Bakhmut), Spetsremmash LLC (16.6%, Horlivka). He also owned 45% of Eastern Donbas LLC (Horlivka), which ceased operations in 2011.
According to Yermakov, in April 2021 Ukeximbank provided a loan of $60 million to the companies Wholesale Network 2011 LLC and Slavian LLC, the beneficiary of which is Briukhovetsky. The loan was issued for the acquisition of corporate rights and the completion of the transaction for the purchase of the Sky Mall trade center in Kyiv. The total sum of the purchase is $80 million.
Thus, $39 million of the loan was used to refinance the Wholesale Network 2011 loan obligations in two Ukrainian and one European banks. Another $21 million was used to complete the acquisition of Sky Mall. In addition, Briukhovetsky contributed $20 million at the expense of his own funds and the funds of a related company – Sky Finance LLC.
“At the request of the bank, the borrower provided the conclusions of professional lawyers, including the British, registered with the Solicitors Regulation Authority, on the settlement of corporate conflicts and lawsuits … The availability of an arbitration award in the case of Estonian businessman Teder Hillar did not jeopardize the borrowers’ ownership of Sky Mall,” Yermakov said.
According to him, the entire complex of structures and the parking space of the Sky Mall shopping center are pledged on the loan. In addition, the bank received a guarantee from Briukhovetsky.
