EBRD supports private sector in Ukraine with loan to OTP Leasing

The European Bank for Reconstruction and Development (EBRD) is extending a local currency senior loan of up to €20 million to Ukraine’s OTP Leasing to support businesses affected by Russia’s invasion of the country, the bank announced. The financing will help strengthen the competitiveness, resilience and inclusiveness of Ukrainian micro, small and medium-sized enterprises (MSMEs) by expanding access to leasing products at a time of tight liquidity and heightened economic uncertainty.

Fifty percent of the EBRD’s loan proceeds will be provided to MSMEs for long-term investments in European Union (EU)-compliant and green technologies. The loan will allow OTP Leasing to meet strong local demand for leasing services, letting MSMEs acquire vehicles, equipment and machinery without large upfront capital outlays when liquidity remains tight due to war-related disruptions.

On completion of their investment projects, eligible sub-borrowers will also receive technical assistance funded by the European Union and investment incentives funded by the United States under the EU4Business initiative. Greater incentives will be provided to support war-affected and vulnerable groups, including MSMEs that have suffered asset loss or destruction, businesses reintegrating war veterans, internally displaced persons and returnees, persons with disabilities, as well as MSMEs relocated from or operating in war-affected regions. Women-led and youth-led enterprises will also benefit.

The loan will be supported by an interest-rate subsidy of up to 10 percent from the United States through the EBRD SME Special Fund. OTP Leasing is an existing EBRD client and the leading leasing company in Ukraine, providing financial leases and fleet management services to corporate and MSME clients across the country. It is a fully owned subsidiary of OTP Bank, a leading regional financial group headquartered in Hungary.

Since Russia launched its full-scale war on Ukraine in 2022, the EBRD has deployed more than €9.1 billion in the country, including €3.3 billion through its partner financial institutions.