MICROCAPITAL BRIEF: EFSE Loans $6m to Agroprosperis Bank to Support Farmers in Ukraine

The European Fund for Southeast Europe (EFSE), a microfinance investment vehicle domiciled in Luxembourg, recently loaned EUR 5 million (USD 6.1 million) to Agroprosperis Bank to support agricultural micro- and small enterprises (MSEs) in Ukraine. In particular, the funds are meant to help MSEs sustain operations as they adjust to the COVID-19 pandemic.

Agroprosperis CEO Serhii Shchepanskyi said the bank “is committed to helping Ukrainian farmers become more profitable, efficient and resilient by offering them available and timely financing… [to] endure and sustain production amid uncertainties, heightened risks and quarantine restrictions.”

Founded in 2016, Agroprosperis provides financing to farming MSEs. As of October 2020, the bank had assets totaling UAH 1.68 billion (USD 59.4 million) and had disbursed UAH 705 million (USD 24.9 million) during the previous nine months.

EFSE provides “long-term” funding for MSEs and households via partner retail institutions. EFSE also operates the EFSE Development Facility, which provides technical assistance, consulting and training services to support capacity building within these institutions. EFSE was established in 2005 by German development bank Kreditanstalt für Wiederaufbau (KfW), with the financial support of the German Federal Ministry for Economic Cooperation and Development (which is also known by its German acronym BMZ) and the EU’s European Commission. The fund is privately managed, with Oppenheim Asset Management Services of Luxembourg acting as fund manager and Finance in Motion GmbH of Germany acting as fund advisor. EFSE operates in 16 countries: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Georgia, Kosovo, Moldova, Montenegro, North Macedonia, Romania, Serbia, Turkey and Ukraine. As of 2019, the fund reports outstanding investments of EUR 957 million (USD 1 billion) in 63 partner lenders, including 35 microfinance institutions. As of January 2021, EFSE holds a microfinance label from Luxembourg Fund Labeling Agency (LuxFLAG), an NGO that certifies that social investment vehicles actually invest as advertised.

By Sai Bommineni, Research Associate

Sources and Additional Resources

EFSE press release
https://www.efse.lu/news-events/news/detail/efse-and-agroprosperis-bank-strengthen-partnership-to-provide-financing-in-local-currency-for-ukrain

Agroprosperis Bank home page
https://ap-bank.com/

Agroprosperis Bank financial data
https://ap-bank.com/en/news/post/rezultaty-agroprosperis-banka-za-tretij-kvartal-2020-goda-ustojchivyj-rost-i-razvitie

EFSE homepage
https://www.efse.lu/

EFSE financial report
https://www.efse.lu/studies-publications/publications/detail/development-performance-q3-2019/

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