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The EBRD is extending a US$10mn line of credit for SME lending to Bank Agio, which becomes the first Ukrainian bank to lend under a new US$200mn framework for financing private-sector micro, small and medium enterprises. The framework will be put to work through credit lines to local commercial banks, without sovereign guarantee and without the National Bank’s participation.

Agio, owned by Skandinaviska Enskilda Banken (SEB) of Sweden, became an EBRD partner in 1995 and has been one of the best performing banks under the SME credit line programme.

The new credit line will not only enhance Agio’s position in the SME market by providing it with long-term financing, but it should also have a wider effect on small-business lending, given that this sector is rather underfinanced in Ukraine, says Jean Marc Peterschmitt, EBRD director of bank debt.

“The new credit agreement with the EBRD, which will simplify access to financing, is an important step in strengthening Agio’s strategy aimed at SME development and the provision of competitive long-term financing,” says Agio chairman of the board Stanislav Arzhevitin.

Bank Agio and its clients have actively participated in the EBRD’s SME Business Project Competitions, designed to improve the management and strategic planning skills of local companies and to promote small and medium-sized business lending in Ukraine. In 2004 Agio’s client Exar, one of Kiev’s best and longest-standing photo labs, won this competition.

Since the launch of the SME credit line programme in 1994, the EBRD has financed 235 SMEs for US$205mn and more than 47,000 micro enterprises for US$304mn of aggregate financing.

The bank’s cumulative investments in Ukraine stand at €
1.6bn through 65 projects.