Investing in Ukraine’s economic resilience and future remains EBRD’s priority. So far this year we have invested €2.2 billion in Ukraine’s real economy, surpassing our goal of investing between €1.5 and €2 billion annually. We are also laying the foundation for the country’s reconstruction, supporting crucial policy reform to achieve impact beyond pure investments.
This month, our Ukrainian partner banks told us about the challenges they face and the opportunities ahead at our third Annual Roundtable on Banking Sector Resilience in Wartime Ukraine. Scroll down to read five things to note about the state of the banking sector in the country. We also released our latest economic forecasts for Ukraine. Amidst the continuation of the war and its impact on investment and trade, we cut our outlook, forecasting growth at 2.5% this year.
Our Managing Director for Ukraine and Moldova, Arvid Tuerkner, has just returned from his trip to Ukraine. What made this one particularly special, was his visit to the Chornobyl Power Plant. He shares his thoughts below.
Thank you for reading our new edition of EBRD in Ukraine Monthly. Scroll down for a recap of the latest news on the EBRD’s activities in the country.
Ukraine’s Wartime Banks Look Ahead
Resilience is the keyword, but challenges remain when it comes to Ukraine’s financial sector.
- Liquidity remains strong with banks holding buffers several times above regulatory requirements, with no systemic stress despite the ongoing war.
- Lending is cautiously recovering, boosted by risk-sharing facilities from IFIs and the government: MSME lending is expected to rise by over 30% in the next 12 months, while corporate and residential by ~25%. Risk appetite is still restrained, but improving.
- Non-performing loans (NPLs) are falling. After spiking in 2022, NPLs have gradually declined to ~27% of portfolios. Most NPLs, however, represent legacy exposures.
- Profitability is robust. Most banks remain solidly profitable. In 1H 2025, our partner banks delivered ~33% Return on Equity (ROE) on average, with state-owned banks achieving ~45%.
- Optimism is on the rise. Sentiment is notably stronger than a year ago, confirmed by both our partners’ feedback and the NBU’s latest surveys.
At the same time labour shortages, operational risks, and an unpredictable tax policy remain the top challenges raised by our partner banks
From the field: Arvid Tuerkner in Chornobyl
Managing Director for Ukraine and Moldova, Arvid Tuerkner, shares his thoughts on his most recent visit to Ukraine, where apart from meeting clients and partners, he also got to visit the Chornobyl Nuclear Power Station.
Why was this trip to Chornobyl special?
This was the first time I got to visit Chornobyl and see firsthand the colossal New Safe Confinement that the EBRD financed as part of a decades’ long international effort to seal off the damaged nuclear plant. It is a true feat of modern engineering: a giant arc made of more than 80 elements and weighing 36,000 ton, which has transformed the site of one of world’s worst ecological catastrophes into an environmentally safe and secure area. The NSC or “shield” as some call it, has been one of the EBRD’s landmark projects. I also got to inspect the damage done to it following Russia’s drone attack on the plant this February.
What was the damage and why is this important?
The giant structure seals out wind, snow, and rain and has been confining radioactivity inside since its completion in 2019. But Russia’s drone strike has damaged the structure. Not only has it caused a 15-metre hole in the shield, but it also ignited a fire inside the sandwich structure of the NSC. In order to extinguish it, 340 holes had to be drilled into the cladding all over the surface. This has caused water to leak inside the plant and risks the possible release of contaminated dust. That’s why it is vital to restore the NSC’s functionality, so the facility continues to perform its originally envisaged function – preventing the toxic radioactive dust from spreading out and enabling the safe dismantling of Soviet-era Sarcophagus covering the 4th reactor underneath it.
What is the EBRD doing to remediate this?
Since the February attack, our Nuclear Safety team has been working on carrying out emergency repairs to the NSC. Our teams were on the ground in Chornobyl days following the attack, to assess the situation. But while repairs are ongoing, much more will need to be done to avoid further deterioration and restore the NSC to adequate safety levels. This is something we continue to work with our Ukrainian counterparts on, and hope this work can be supported by all of Ukraine’s partners.
Source: https://www.linkedin.com/pulse/ebrd-ukraine-monthly-ebrd-rfhre/