Oschadbank Has Put Together a New Pipeline of Municipal Projects Worth 74 Million Euros and Called for Greater Support for Local Communities at URC 2026

Ukrainian communities need wider access to long-term financing, grant programs and risk-sharing mechanisms to implement recovery projects. The statement was emphasized by Natalia Butkova-Vitvitska, a Member of the Management Board of Oschadbank in charge of micro, small and medium-sized enterprises, at thematic round-table discussions involving international financial organisations as part of the Ukraine Recovery Conference 2026 in Gdańsk, dedicated to municipal development and organised by the Polish development bank BGK, and on recovery financing, organised by the Ministry of Economy of Ukraine and the Kyiv School of Economics.

It is the local communities that are currently the main drivers of the country’s recovery. Oschadbank is therefore continuing to work actively with local authorities, offering financial and expert support. Today, Oschadbank is the market leader in municipal lending amongst the Ukrainian banks, holding a market share of around 39 per cent. Some of the key areas of cooperation include the modernisation of water supply and drainage systems, the upgrading of public transport, the development of municipal infrastructure, improving the energy efficiency of buildings, as well as the construction and renovation of social infrastructure.

At the same time, one of the most topical areas of cooperation with local communities now involves projects aimed at strengthening their energy independence and resilience.

Natalia Butkova-Vitvitska shared Oschadbank's experience in municipal projects financing and  the role of banks in attracting investment for community recovery.

“Today, nearly a thousand of Ukraine’s local authorities are financially viable, yet by no means all of them are currently utilising loans for development. Oschadbank seeks to change this trend: as of the end of June 2026, we have already established a new pipeline comprising 32 municipal projects totalling 74 million euros. Our task, along with our international partners, is to transform this financial potential into real recovery projects that will improve people’s quality of life and strengthen the regions”, -noted Natalia Butkova-Vitvitska.

The work on this portfolio expanding actively continues in both key segments: 26 projects from the aforementioned pipeline are planned for the small and medium-sized business segment (small towns and villages), while six are planned for the corporate segment, targeting large regional centres.

One of the key obstacles to scaling up municipal financing remains the poor preparation of investment projects by local authorities. This is precisely why international technical assistance to local authorities should cover both financing and the preparation of feasibility studies, energy audits, ESG risk assessments and the development of high-quality projects suitable for bank financing.

According to Nataliia Butkova-Vitvitska, the implementation of large-scale infrastructure and energy projects requires long-term financial instruments. Therefore, international risk-sharing mechanisms should be structured for a term of at least 10 years, enabling banks to finance community recovery and the implementation of investment projects in a more proactive manner.

The work on expanding this portfolio actively continues in both key segments: 26 projects from the aforementioned pipeline are planned for the small and medium-sized business segment (small towns and villages), while six are planned for the corporate segment, targeting large regional centres.

Participants at the round table emphasized the need for the comprehensive development of support tools for the municipal sector. According to a speaker from Oschadbank, to significantly increase the volume of investment in the recovery of Ukrainian municipalities, international partners and the state must focus their efforts on several key areas:

• ​developing mechanisms for technical assistance to local authorities (preparing technical-economic feasibility studies, conducting energy audits and assessing ESG risks);
• ​harmonizing and simplifying procurement procedures in line with international standards;
• ​introducing effective risk-sharing mechanisms and providing guarantees from the government and IFIs for projects with a repayment period exceeding 10 years;
• ​expanding grant instruments integrated through bank loans to make projects financially attractive to local authorities;
• ensuring access to long-term financial resources for up to 20 years;
• providing active information and training support to municipal teams to enhance their capacity to prepare high-quality investment projects.

Despite the challenges caused by the war, Ukrainian local authorities remain reliable borrowers. Generally, there are over 1,400 local authorities in Ukraine, about a thousand of which are creditworthy. The total volume of the municipal borrowing market has reached almost EUR 2.7 billion in recent years, with the domestic market accounting for EUR 1.1 billion. At the same time, international financial organisations have already financed community projects to the tune of more than EUR 1.6 billion, reflecting the strong level of confidence in this sector.