Financial sector news

The International Finance Corporation (IFC), part of the World Bank Group, has announced investments in the share capital of two leading Ukrainian insurance companies, Knyazha and Ukrainian Insurance Group (USG). This is the first time the corporation has invested in the capital of Ukrainian insurance companies.

Both companies are among the ten largest in the Ukrainian market and are part of the Vienna Insurance Group. The IFC will acquire a 20% stake in each company. The investments will help ensure business continuity, expand access to insurance products, and strengthen Ukraine's insurance market amid the Russian invasion.

"This investment in share capital will help companies adapt to current conditions and clearly demonstrate to other investors the sector's ability to overcome difficulties and focus on long-term prospects. At a time when fresh capital inflows into Ukraine are limited, this project aims to stimulate growth, strengthen resilience, and support the country on its path to recovery and reconstruction," the IFC said.

The investor will also complement its investment with advisory support to help companies expand their offerings and develop long-term digital strategies. These efforts will enable companies to diversify their insurance products beyond motor insurance to better protect other critical sectors such as logistics and agriculture, real estate, healthcare, and meet the needs of a broader customer base, including small businesses and vulnerable groups such as internally displaced persons. By protecting critical sectors—primarily transportation, logistics, energy, agriculture, housing, and healthcare—the insurance industry can help protect assets, reduce risks, and ensure economic growth. IFC's equity investments in Ukrainian insurance companies inject much-needed long-term capital into the sector, sending a strong signal of confidence in its resilience and providing the private sector with the stability it needs to weather difficult conditions and accelerate recovery," said Vittorio Di Bello, Director of the IFC Financial Institutions Group in Europe, Latin America, and the Caribbean.

The investor believes that this initiative will leverage the unique market reach of Knyazha and USG to increase access to insurance products throughout Ukraine. Knyazha's extensive presence in western regions and rural areas, as well as USG's active operations in large cities, will contribute to broad nationwide coverage.

These investments complement the World Bank's Financing for Growth project, which is helping the National Bank of Ukraine to update insurance legislation in line with EU standards and improve the system of insurance against war-related risks.
IFC's work in Ukraine is part of a broader World Bank Group response package that has supported more than 20 million Ukrainians by helping businesses stay afloat and enabling the government to provide essential services, pay salaries, keep schools and hospitals running, and carry out urgent recovery work.