The International Finance Corporation (IFC), a member of the World Bank Group, has placed its debut issue of bonds denominated in hryvnias at 15.75% per annum to support its operations in Ukraine.
On May 13, the first issue of bonds in the hryvnia was carried out, IFC Regional Manager for Ukraine, Belarus and Moldova Jason Pellmar said.
According to him, this placement confirms interest in hryvnia instruments in the market, especially when the issuer has an “AAA” rating.
The IFC representative office told the agency that the debut issue of bonds would be repaid in 2020.
The International Finance Corporation (IFC) has said the international crop receipts could be launched in spring 2019, IFC Project Manager for Ukraine Crop Receipts Helen Fairlamb said at a roundtable in Kyiv on Wednesday.
The IFC has already conducted the first trainings for farmers and hopes to see the first deals in the spring, Fairlamb told Interfax-Ukraine.
As the IFC said, after the entry into force of the law on currency and foreign exchange transactions, farmers can raise funds on crop receipts from nonresident creditors. According to the international receipts mechanism developed by IFC, such transactions will include a financial crop receipt and a loan/forward contract or an import contract.
Crop receipts are particularly relevant in Ukraine, where the land moratorium still exists, and farmers do not have a quality guarantee to attract financing. In addition, crop receipts are registered in the online register, and the lender can see how many receipts the farmer has and performs, Regional Manager for Belarus, Moldova and Ukraine at IFC Jason Pellmar said.
He added that crop receipts help farmers create a credit history to further raise funds.
According to the IFC, under the crop receipts project, it is also planned to modernize the legislation to create a secondary market for crop receipts (securitization).
Member of the Board of OTP Bank Alla Biniashvili said that for banks providing financing on crop receipts, the difficulty is that the National Bank considers these loans as unsecured.
The total amount of crop receipts in 2018 exceeded $200 million (UAH 5.24 billion). In total, 669 crop receipts were issued from 53 lenders for 1.1 million tonnes of agricultural products used as collateral.
From the beginning of 2019 as of February 12, 2019, a total of 104 receipts were issued to the amount of over UAH 1 billion.
Top managers of the International Finance Corporation (IFC) at a meeting of the National Investment Council of Ukraine in Davos (Switzerland) has confirmed their readiness to consider investment in the capital of state-owned Ukrgasbank, Head of the Office of the National Investment Council Yuliya Kovaliv has said.
As reported, in November 2017, Ukraine’s Ministry of Finance agreed on cooperation with the International Finance Corporation (IFC) in the process of privatization of Ukrgasbank. The memorandum of cooperation also envisaged a possibility of entering the capital of the bank by IFC to support its sale. The investment will depend on several factors, including the outcome of the due diligence of the bank.
Ukrgasbank was established in 1993 and as of January 1, 2017 the state represented by the Ministry of Finance owned 94.9% of its shares. Since 2015, the bank has been included in the list of state-owned facilities of strategic importance for the economy and national security.
The International Finance Corporation (IFC, the division of the World Bank Group) and the Swiss State Secretariat for Economic Affairs (SECO) have signed an agreement to facilitate energy efficiency renovations in Ukraine’s residential sector.
According to a posting on the website of the IFC, Switzerland will provide up to $1.8 million to IFC Advisory Services to support legal reforms that will support energy-efficiency refurbishments by engaging with housing management companies on behalf of homeowners’ associations.
According to the report, the initiative represents the third and the final phase of IFC’s Residential Energy Efficiency Advisory project in Ukraine, which started in partnership with SECO in 2010.
The International Finance Corporation (IFC) on June 1 signed a contract to provide the largest Ukrainian vertically integrated tomato paste producer, Agrofusion, with a long-term loan of $17 million. According to information on the IFC’s website, the funds are intended to expand the company in 2018-2019 and refinance its obligations. The total cost of the project is estimated at $30 million.
The IFC said this is the third project with Agrofusion.
Agrofusion is the largest vertically integrated producer of tomato paste in Ukraine. It was founded by businessman Serhiy Sypko in 2007. Agrofusion includes three tomato paste production plants with a total production capacity of about 750,000 tonnes of tomatoes per season, as well as agribusinesses in Kherson and Mykolaiv regions, cultivating 25,000 hectares of irrigated land, and two hothouse farms. In 2017, the company expanded its capacity and reached 79,443 tonnes of paste (64,800 tonnes in 2016). Some 70% of its products are exported to 35 countries.
The International Finance Corporation (IFC) from the World Bank group has signed loan agreements on the provision of financing to the largest sugar producer in Ukraine Astarta for the amount of $30 million and the large pork producer Nyva Pereyaslavschyny for $12.5 million.
“Agribusiness is a priority for IFC globally, and Ukraine is very important to our strategy in the sector,’ Stephanie von Friedeburg, IFC’s chief operating officer, said during a signing ceremony in Kyiv.
According to the press release, IFC’s financing will support a two-year investment program aimed at improving the company’s resource efficiency and competitiveness by modernizing its sugar plants. This would help reduce the use of gas, electricity, and water. The program also aims to help Astarta—which grows and trades grain and oilseed—purchase modern and efficient farm machinery and construct of new storage facilities.
IFC is providing long-term debt financing to support Nyva’s investment program, which includes constructing a new meat-processing facility that will become one of the country’s first to comply with European Union standards for food safety and animal welfare. The company will also build a new pig farm and a rendering plant capable of recycling up to 50 tonnes of waste every day, helping to reduce its environmental footprint.
This is IFC’s second investment in Nyva.
Pork production in Ukraine remains inefficient and highly fragmented, with many smaller producers lacking sufficient quality controls, IFC said.