- EIB and PRAVEX BANK have signed a €30 million loan to enhance access to finance for SMEs and mid-caps in Ukraine.
- The operation comes under the Team Europe initiative aiming to provide a rapid response to the coronavirus outbreak.
The European Investment Bank (EIB) and PRAVEX BANK, a member of the Intesa Sanpaolo Group, have signed a €30 million credit line to support Ukrainian private sector businesses, with a focus on small and medium-sized enterprises (SMEs) impacted by the coronavirus pandemic.
SMEs are the backbone of the Ukrainian economy as they account for over 90% of local businesses, contribute more than 50% of GDP, and employ about 60% of the working population. As a consequence of the COVID-19 outbreak, many companies have experienced a decrease in turnover and profitability, leading to payment delays and an increased demand for liquidity. It is now crucial to step up support for private sector businesses, thus helping to protect jobs and keep the economy going.
The operation is a part of Team Europe’s overall response to the COVID-19 crisis aiming to support a sustainable social and economic recovery in the region.
Head of the EIB Resident Representation for Ukraine Jean-Erik de Zagon said: “Small and medium-sized enterprises are vital for the Ukrainian economy and have been hit particularly hard by the COVID-19 crisis. It is one of the EIB’s top priorities to support the resilience of the private sector during this unprecedented crisis with the provision of funding through our cooperation with PRAVEX BANK. The operation aims to make available vital financing for SMEs and mid-caps to help them cope with the economic impact of the COVID-19 pandemic – not only to keep businesses afloat, but also to strengthen their resilience and safeguard jobs.”
Head of Cooperation of the EU Delegation to Ukraine Frederik Coene said: “More than ever during these challenging times, businesses need access to affordable credit from banks. The EIB plays an important role in the support of the private sector as part of the European Union’s overall Team Europe relief effort. This assistance comes at a time when SMEs need strong support to overcome the challenges created by the COVID-19 pandemic.”
Chairman of the Management Board of PRAVEX BANK Gianluca Corrias said: “Cooperation with the EIB constitutes an important step in helping our bank reach its strategic goal to expand financing of small and medium enterprises, as well as mid-caps. This credit line will help us support our clients from the real economy, providing them with the affordable loans they need in order to mitigate the economic consequences of the pandemic crisis they have faced.”
Team Europe adds value for Ukrainian companies
The EIB investment is an integral part of Team Europe’s overall response to COVID-19 and supports the sustainable social and economic recovery of the EU’s Eastern Neighbourhood. The operation reinforces both SMEs and mid-caps, which are the backbone of national economies and a major source of employment.