OREANDA-NEWS. December 10, 2009. The European Bank of Reconstruction and Development (EBRD) has unveiled its plan to invest EUR 1.1bn to Ukraine in 2010. According to its previous announcements, the funds will be targeted for the banking sector and the energy saving technologies sector. At the same time, the International Finance Corporation (IFC) announced about it was prepared to provide around USD 300mn of guarantees for non-performing loan (NPL) portfolios of the Ukrainian banks.

Millennium Capital consider the news as a positive for commercial banks. Namely, the EBRD banks funding (estimated at EUR 500mn) will enable the banks to strengthen their capital adequacy, as well as increase the amount of lending and expand their credit portfolios. Meanwhile, the IFC guarantees will enable the banks to release funds from their NPL reserves and increase foreign currency lending. This follows from the NBU resolution #650 announced yesterday. Considering the close cooperation of the above organizations with Raiffeisen Bank Aval and Megabank, Millennium Capital expects them to be among the first banks to re-vitalize the domestic credit market in 2010.