UGB joins EBRD’s Energy Security Support Facility

UGB (Ukrgasbank) has become one of the first two banks in Ukraine to join the EBRD’s Energy Security Support Facility (ESSF), a landmark programme that will enable the country’s financial sector to  provide better access to financing for energy security investments in Ukraine. 

EBRD is extending to UGB a €150 million portfolio-risk-sharing facility, which will support its lending to small and medium-sized enterprises (SMEs), private households, regional municipalities and medium-sized corporate clients for implementation of decentralised energy generation and energy efficiency measures. The improvements are critical for Ukraine’s energy security. 

Through the ESSF the EBRD will partially cover the risk of partner financial institutions for investment in decentralised energy generation, energy storage and energy efficiency measures. 

Ukrainian businesses, state-owned enterprises, including municipalities, municipal companies and households, will be eligible for loans through the facility, thus strengthening their resilience to both immediate energy security risks and the medium-term impacts of climate change.

The attacks are estimated to have caused a loss of more than 9,000 MW of generating capacity in the country, significantly impacting Ukraine’s ability to maintain economic and industrial operations. Ukraine’s energy security and business survival is therefore at risk and the impact on civilians is acute.   

The ESSF is another tool that the EBRD can use to support Ukraine’s energy security amidst the russian attacks on its critical energy infrastructure. 

“Even as war rages, UGB, as a leader in sustainable finance in Ukraine, is actively driving energy independence for businesses, households and the country as a whole. Through our strategic partnership with the EBRD, we are enhancing this commitment. The new EBRD facility will empower us to further support our clients, ensuring their energy resilience during the ongoing energy crisis,” stated Volodymyr Ponomarov, First Deputy Chairperson of the Board of Ukrgasbank. 

Ukrgasbank is the fifth largest bank in Ukraine and one of the country’s 15 systemically important financial institutions. It holds a strategic position in the national economy, catering to a diverse range of clients, including individuals, small and medium-sized enterprises, large corporations, utility companies, and municipalities. With a network of 215 branches across Ukraine, the bank services around 1.5 million individuals and 87 thousand corporate and SME clients.

The EBRD is Ukraine’s largest institutional investor. It has deployed more than €4.5 billion in the country since 2022 and has secured agreement for a further €4 billion capital increase to continue lending at these levels in wartime, with the potential for more once full reconstruction begins. 

12.09.2024