Ukraine's central bank relaxes business loan, agricultural collateral requirements
The National Bank of Ukraine (NBU) has allowed banks not to classify borrowers as being in default in the event of short-term debt restructurings of up to one year caused by war-related financial difficulties. The regulator has also eased requirements governing the recognition of agricultural products as loan collateral, the NBU's press service reported.
The relaxation of restructuring requirements will apply to legal entities and sole proprietors whose debts are restructured between July 1, 2026, and September 1, 2027, inclusive. At the same time, banks must assess the borrower's ability to overcome financial difficulties, resume servicing the debt, and repay it within the agreed timeframe.
The amendments also introduce special rules for recognizing agricultural products as collateral for loans extended to agribusiness enterprises until September 1, 2027. In particular, the liquidity coefficient for such collateral has been increased to 0.75 from 0.4, while the maximum loan agreement term during which it may be recognized as eligible collateral has been extended to 18 months from 12 months.
Banks will also be allowed to determine the value of pledged agricultural products based on their actual inventory as of the reporting date, but not above the value specified in the pledge agreement.
According to the NBU, these changes are expected to expand agribusinesses' access to financing for working capital, product storage, and the use of alternative logistics routes amid disruptions to export logistics.
"Our decisions do not eliminate prudent risk assessment. They provide banks with greater flexibility while giving viable businesses the opportunity to get through a difficult period," NBU Governor Andriy Pyshnyy said.
Separately, the National Bank amended the rules governing the recognition of guarantee instruments provided on a portfolio basis. For guarantees featuring two coverage levels (individual coverage and an overall portfolio limit) a bank will, under certain conditions, be able to recognize collateral at the individual coverage level.
Specifically, the utilization of the portfolio limit should generally not exceed 50%, and the bank must monitor its utilization and expected payouts at least once a year.
These changes are expected to encourage broader use of portfolio guarantees, particularly the instruments provided under the Ukraine Facility financial support program.
The central bank also clarified the procedure for calculating the number of days a retail loan is overdue if it has been repaid in full or in part using funds from another loan, such as an overdraft facility or a credit card.
The regulator noted that the amendments were approved by NBU Board Resolutions No. 88 and No. 89 dated August 7, which enter into force on August 8.