EBRD Provides Portfolio Risk-sharing Facility to OTP Leasing in Ukraine

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The European Bank for Reconstruction and Development (EBRD) is extending an unfunded portfolio risk-sharing facility to OTP Leasing in Ukraine to unlock EUR 80m of new leasing finance for Ukraine's business sector amid the ongoing war waged by Russia, according to a report by state news wire MTI.

The EBRD's facility will cover up to 50pc of OTP Leasing's credit risk on new leasing finance to businesses operating in Ukraine. This credit enhancement mechanism enables OTP Leasing to finance the agribusiness sector and other critical industries, such as manufacturing, transport, and logistics. 

The agreement between the EBRD and OTP Leasing is an extension of cooperation in support of Ukrainian businesses that began in 2022. 

One element of the facility is a program to enhance the competitiveness of micro, small, and medium-sized enterprises (MSMEs) in the European Union's Eastern Partnership countries. Up to 27.5% of the risk-shared loans will support private MSMEs' long-term investments in EU-compliant and green technologies. 

The EBRD facility will be supported by first-loss risk cover funded by the United States through the EBRD Crisis Response Special Fund donors.

OTP Leasing is a fully owned subsidiary of OTP Bank. Established in 2008, OTP Leasing has become the market leader in Ukraine in providing leasing finance and operating leases, as well as car-fleet management services. It had around a 41% share of the country's leasing portfolio at the end of 2023.

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