The board of the European Bank for Reconstruction and Development (EBRD) has approved a capital increase of €4 billion, which will allow it to double its investment in Ukraine after the start of post-war reconstruction.
This is reported by Reuters.
The decision will enter into force on December 31, 2024. This is the third time in the history of the EBRD that the bank has increased its capital. This time — up to €34 billion.
"Increasing the bankʼs capital will allow us to get more and become an even stronger bank — a stronger bank for Ukraine, a stronger bank for all our economies and customers, as well as a stronger bank for our shareholders," said EBRD President Odile Renault-Basso.
The EBRD has been the largest institutional investor in Ukraine for the past 30 years. He greatly increased his support after the Russian invasion in February 2022. For 2022-2023, the bank allocated €3 billion to Ukraine.
In June, the Fitch rating agency estimated the net risk of the EBRD under guarantees to Ukraine at €2.5 billion, which is equivalent to 12.8% of the equity capital. Fitch warned that the EBRD and the World Bankʼs International Bank for Reconstruction and Development (IBRD) could lose their credit ratings if Ukraine defaults on its loans.
EBRD shareholders will be entitled to additional shares within the scope of the capital increase. This option will become available in early 2024, with payouts in early 2025.
In addition to the European Union and the European Investment Bank, the EBRD has 72 national shareholders. Since its inception in 1991, it has invested more than €190 billion.