AUB partners news

According to the results of the first quarter of 2024, the volume of SME financing at Globus Bank reached pre-war levels. This was stated by Oksana Shulga, Director of Small and Medium Business Department of Globus Bank, during the round table “Situation in the SME market: wartime challenges”, the bank's press service reports.

The event focused on the main trends in the SME lending market, customer needs and lending conditions in 2024, as well as war risk insurance.
Specialists from leading Ukrainian banks were invited to participate in the discussion, including Oksana Shulga, Director of SME Department at Globus Bank. She emphasized that the development of SMEs is a requirement of the present time

“The demand of SME clients is growing rapidly. The areas requiring financing are quite diverse - from services and manufacturing to the processing industry. Financing of the medical industry has also been increasing recently. Our Bank did not leave the SME lending market after the full-scale invasion began, and in the first quarter of 2024, our funding volumes reached pre-war levels. We strive to create products and services to support businesses under any conditions,” the banker said.

COMINBANK joined the Program of compensation to agrarians for the cost of agricultural machinery of domestic producers. This was reported by the bank's press service.

The signing of a memorandum with the Ministry of Economy of Ukraine means that from now on, our clients can receive compensation from the state in the amount of 25% of the cost of purchased machinery from a Ukrainian manufacturer.

“For the third year in a row, Ukrainian farmers have been bearing the heavy burden of war on their shoulders. The damage and losses incurred by our agricultural sector amount to billions. Nevertheless, it continues to work heroically, providing food for Ukraine and the world. That is why today we are extremely pleased to take a step towards supporting agricultural producers. I am grateful to everyone who contributed to this important decision in favor of the agricultural business. After all, we are talking about serious support for the industry and food security of our country,” commented Tatyana Putintseva, Chairman of the Management Board of COMINBANK.

In order to receive compensation for the cost of agricultural machinery, agrarians (the Bank's clients) need to:

• choose a supplier (from the list on the website of the Ministry of Economy)
• purchase equipment of domestic production
• submit an application for compensation and supporting documents to the Bank
• receive compensation to the current account with the Bank.

The list of equipment subject to compensation is available on the website of the Ministry of Economy of Ukraine

monobank | Universal Bank will buy a house for 98-year-old Lydia Stepanivna from Ocheretyne, Donetsk region, who impressed the whole of Ukraine with her bravery and resilience by leaving the temporarily occupied territory on foot, the bank said.

The woman, fleeing from the Russian occupiers, left the city under fire on foot and walked about 10 kilometers. Lidiya Stepanovna's house, which she built with her own hands, was destroyed by the Russians. Her family was injured. The elderly woman said that "terrible things are happening in the village".

Lidiya Stepanivna walked all day without food and water, fell down several times and, as she says, "fell asleep". She was holding on with two sticks and her "character". In the midst of the fighting, the pensioner miraculously remained alive and unharmed.

In the evening, Ukrainian soldiers saw Lidiya Stepanovna, exhausted but not broken, on the road. She was handed over to the police from the White Angel group, who took her to a shelter for evacuees. Lidiya Stepanovna is now feeling well, the National Police of Ukraine reported.

"I lived through that war and I am living through this war. I was left with nothing. But I survived with my Ukraine," the woman says.

Her daughter-in-law suggested that they go amid the danger, but on the way, the relatives got separated. Later, it turned out that the elderly woman's son and his wife had also left the occupied territories and were in the hospital. The police contacted Lidiya Stepanivna's granddaughter, who was to come to pick her up.

Recently it became known that monobank Universal Bank will buy a house for the 98-year-old heroine.

Iryna Starominska, Chairman of the Board of JSC Universal Bank, announced this on her Facebook page: "The house that Lidia Stepanivna built with her own hands was destroyed by the occupiers. To escape from them, my grandmother walked all day without food and water, fell down several times and, as she says, "fell asleep". The woman was holding on to two sticks. In the midst of the fighting, she miraculously survived. Now the old lady is under the care of our military. 98 years old! The second war in her life. She survived the occupation again. From monobank I Universal Bank we decided to buy a house for my grandmother."

This is another great example of how Ukrainians support each other in this difficult time. Lidiya Stepanivna is a real heroine who shows by her example that even in the most difficult situations, one should not lose faith and hope.

NovaPay has registered and placed three more issues of its own bonds - series D, E and F - for UAH 300 million each. The securities are already available for purchase in the NovaPay mobile application. There they can be easily purchased in a few minutes and in a few clicks. This was reported by the company's press service.

 

"NovaPay's own bonds are a worthy alternative to a bank deposit with a competitive yield and a simple purchase process. This is an additional opportunity to diversify your investment portfolio, take care of the safety and accumulation of funds," says Igor Prikhodko, CFO of NovaPay, "We appreciate the trust of customers who have already purchased our securities - 1,000 customers who have bought bonds for more than UAH 200 million - and we are introducing new issues.

The interest rate is set at up to 17% per annum. The bonds will be available for a term of 1 to 12 months. Income will be paid to the client's payment account after the expiration of the securities purchase agreement.

For reference:

NovaPay is the first private company in Ukraine to issue corporate bonds with a public offering in wartime. In 2023, the company placed the first three issues of securities (Series A, B, and C) for UAH 100 million each.

In case of positive economic dynamics by the end of the year, the rate on 3-month certificates of deposit, which is the basis for the yield on hryvnia deposits, may decrease from the current 17.5% to 13-14%, which will affect the yield on hryvnia deposits. However, due to low inflation, their popularity will remain high. This was announced by Serhiy Mamedov, Chairman of the Board of GLOBUS BANK.

The head of GLOBUS BANK does not rule out that by the end of 2024, rates on hryvnia deposits, depending on the term of placement, may slightly decrease, with maximum rates at 12-13% per annum. However, in the context of low inflation, which does not exceed 3.2% per annum, the “net” return on hryvnia deposits will be 5%, which is almost three times higher than the return on foreign currency deposits. The expert expects that the popularity of hryvnia deposits as the optimal and most profitable mechanism for generating passive income will remain high, and the number of new deposits in 2024 will increase by at least 10% compared to 2023.

“Currently, there are sufficient grounds for the situation in the banking sector to remain acceptable and promising despite new challenges, especially with regard to the further development of loan and deposit programs,” emphasized Sergiy Mamedov.

Speaking about the main expectations from the banking sector, the expert noted that as of mid-April, the key indicators set out in the state budget for 2024 are being met, primarily in terms of the “weak” devaluation of the hryvnia. Thus, in January-March, the dollar grew by an average of 2.6% against the hryvnia (from UAH 38 as of January 1 to UAH 38.99 as of April 1), which is almost a third of the planned annual devaluation - the budget provides for a rate of UAH 40.7, which is 7% of the “starting” rate at the beginning of 2024.

Mamedov suggests that if the budget forecasts coincide with the real situation, further devaluation of the hryvnia may amount to another 4.4%, and by the end of the year the national currency will theoretically decline at a slow pace of 0.5% per month on average (approximately UAH 0.19). According to him, during the first quarter, exchange rate fluctuations, both upward and downward, occur with a slight deviation from the “base” rate, which in the weekly context does not exceed 2%. At the same time, the permissible “backlash” of exchange rate changes is up to 5% of the basic rate.

“We understand that the market is alive, but the regime of ‘managed flexibility’ introduced by the regulator suppresses any manifestations of unmotivated growth of exchange rates, satiating demand through active foreign exchange interventions on the interbank market. This “formula” has so far met expectations, as further liberalization of the foreign exchange market will depend on a number of economic and military circumstances, among which the cornerstone is the amount of macro-financial assistance that covers the array of budget expenditures, as well as sufficient military and technical assistance to successfully fight the enemy,” the banker said.

Regarding the prospects for further development of banking products, in particular lending, the expert said that the March reduction of the discount rate from 15% to 14.5% creates the basis for a gradual correction of the actual rates on major loan products, such as targeted lending programs for small and medium-sized businesses, car loans, and mortgages in the primary market. In addition, he suggested that on April 25, at the next meeting of the NBU Monetary Committee, the regulator may once again cut the key policy rate by an average of 0.5-1 percentage points to 13.5-14%, and the rate on 3-month certificates of deposit may be reduced to 16.5-17%.

“Lowering the key policy rate allows banks to develop lending programs more actively, significantly reducing the interest rate pressure on the borrower. We can already talk about a certain benchmark by the end of the year: in the second half of the year, with the discount rate reduced to 14-12%, interest rates on some loans, especially on partnership loan programs, may fall by 2-3% on average,” predicts Sergey Mamedov.

According to the expert, by the end of the year, the “new” rates, depending on the down payment and loan term, may be as follows
car loans - from 5% to 12% per annum;
mortgage loans under joint programs with housing developers - from 4% to 16% per annum;
targeted loans for SMEs - from 15% to 17% per annum.

According to Serhiy Mamedov, the banking system was well prepared, having withstood the March and April missile and drone attacks on Ukrainian energy infrastructure facilities. However, certain difficulties in the work of branches were observed in the cities that suffered the greatest damage and where temporary power outages were introduced, in particular in Kharkiv, Odesa, Dnipro, Zaporizhzhia and a number of others.

According to the banker, the problems with power supply caused by the missile terror should be considered temporary, because, firstly, more than 2/3 of all bank branches are connected to the Power Banking system, which provides uninterrupted power supply, unimpeded access to the Internet, necessary banking operations, enhanced cyber protection against hacker interference, and overall safe stay of citizens in the branch, etc.

Secondly, in case of possible interruptions of mobile operators, a digital signature of the client has been introduced in banking applications, which will not require additional SMS confirmation for withdrawal of funds. In addition, the list of channels for notifying customers has been expanded, primarily through the use of messengers to which customers' mobile numbers are linked.

Thirdly, most banking operations can now be performed remotely through banking applications: from the simplest transfers to installment plans, opening a deposit, bank card, transferring funds to foreign bank cards with minimal fees, obtaining a loan, etc.

The expert said that the branches of the bank he heads, located in Odesa, Kharkiv, Dnipro, Zaporizhzhia and Sumy, have implemented an enhanced indefinite blackout protocol, which aims to ensure complete security of each transaction, provide the maximum range of services, promptly respond to any external threats and optimize working hours according to the security situation (depending on the specifics of the transaction, customers are redirected to other branches), as well as provide first aid to customers if necessary.

According to him, in March, the number of offline applications to bank branches in these cities decreased by an average of 15%, while the number of online applications through the banking application increased by an average of 25% (this includes both existing customers and those who have installed the application on their smartphones for the first time). In addition, the working hours of the branches were reduced by an average of 1.5 hours in compliance with the general requirements for the safety of citizens (for example, in case of air raid alert).

“Of course, it is quite difficult to predict the insidious actions of a completely unpredictable enemy. However, the easiest thing to do to ensure acceptable operation of bank branches is to equip them with generators of optimal power. From October 2022 to April 2023, Ukraine has already experienced the “half-year of generators,” and the experience has proven that even in difficult circumstances, the work of bank branches has not changed much (except for those cities where temporary restrictions and hourly power outages were observed after the March and April attacks). It can be said that the work of bank branches will stop only in the worst and most difficult case - when the military threat becomes insurmountable and there is a need to evacuate citizens,” the banker emphasized.

Answering the question whether there is a threat of a massive outflow of clients due to the escalation at the frontline and a possible repeated attack of the aggressor, as well as the related lack of confidence in the stability of the national currency, Serhiy Mamedov noted that as of mid-April, the potential risks for the Ukrainian banking system were quite controlled.

“Military risks were and are significant, and this is nothing new. For more than 2 years now, a full-scale war has been an integral part of all spheres of life and the country's economy. We are grateful to the Armed Forces of Ukraine, which are heroically defending our country, for the fact that Ukraine has adapted to live in a new dimension to some extent, although this “adaptation” comes at a huge price every day. However, the risk of not receiving the macro-financial assistance, in particular from the United States, that is so necessary for the state budget, may provoke an outflow of clients or curtailment of bank lending and deposit programs,” the expert emphasized.

He reminded that since the beginning of the year, Ukraine has already received $10.1 billion in external financing (more than $9 billion in March), which fully covers the 3-month need (from January to March inclusive) for external financing. At the same time, Ukraine has been waiting for a powerful package from the United States for six months now, and it is still waiting for a powerful package of more than $61 billion, of which $9.6 billion will be used for economic support.

“Without this help, the Ukrainian government will have to raise money from new and old ‘donors’ or, for example, cut annual state budget expenditures by more than UAH 380 billion (13.4% of total expenditures), which is extremely undesirable in a time of war,” the banker emphasized.