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Creditwest Bank 2 - SME

Ukraine | Financial Institutions

Identification Code:: OP/21/0024
Total Operation Cost:: 5.000.000 USD
Maturity:: 36 months
Operation Status:: BSTDB Approved Amount – Approval Date

5.000.000 USD – 24 Jun 2021
: BSTDB Signed Amount – Signed Date

5.000.000 USD – 01 Sep 2021
: Status:
Completed
Description and Purpose of the Operation:: The Loan will support the business growth of Creditwest Bank with focus on SME development which is considered a strategic priority for the Borrower. BSTDB financing will contribute towards expanding of the SME lending program of the financial intermediary and increase the accessibility to finance for small and medium sized private businesses and entrepreneurs. The proceeds of the Loan shall be used by the Borrower exclusively for the purpose of providing SME sub-loans to eligible clients in accordance with the eligibility criteria agreed with the Bank.
Countries of Operation:: Ukraine (100,00%)
Financial Product:: SME's
Sector:: Financial Institutions
Domain:: Private
Borrower/Client:: Joint Stock Company "West Finance and Credit Bank" (Creditwest Bank), established in 2006, is a universal bank with focus on corporate banking with a strategic priority to develop SME segment. The principal activities of the bank include lending, deposits taking, cash and settlement operations, operations with securities and foreign exchange.
Co-Financers/Participants:: n/a
Guarantors/Sponsors:: n/a
Developmental and Regional Cooperation Impact:: The operation will have favorable but, given the size, limited economic benefits for the Ukrainian economy, the most relevant being the tax revenue gains from economic activity, increase in employment, a potential increase in export capacity and competitiveness, and multiplier effects for other parts of the economy. The regional cooperation element is expected to be modest given the size of the loan compared to the size of the Ukrainian economy. Other BSTDB countries are important trade partners for Ukraine, so to the extent SMEs benefiting from financing from the operation engage in export activities with other BSEC countries, there will be regional cooperation benefits. Additional regional cooperation element stems from the fact that the intermediary bank is operating in Ukraine but owned by the Turkish entity. The operation is consistent with the sectoral and operational priorities outlined in the BSTDB’s Medium Term Strategy and Business Plan 2019-22 and the Country Strategy for Ukraine 2019-2022.
Environmental Classification and Impact:: The Operation involves providing an SME loan to Creditwest Bank an existing borrower of the Bank with a trade finance facility. The E&S risks associated with operations of an individual SME are generally limited but aggregated across the SME portfolio of an FI could be more material and require proper management. The FI will have appropriate policies and procedures, as well as trained officers to carry out the E&S assessment of the SME portfolio and ensure compliance with the national norms and regulations but also own requirements e.g. excluded activities, thus preventing any reputation and legal risks as well as financial consequences that may stem from improper management of E&S risks. For the purpose of this operation it is highly recommended for Creditwest Bank to apply BSTDB’s E&S requirements for FIs outlined in its E&S Policy, as well as the Exclusion List.
Operation Leader:: Financial Institutions II
E-mail:: fi2@bstdb.org