This type of banking is a unique business development and import costs mitigation opportunity offered by VABank to its regular and prospective clients. In view of high lending rates on Ukrainian credit market, VABank mostly operates through credit line arrangements.

Commodity loan is a form of import/export transaction where an exporter in one country supplies an importer in another country goods or services on a deferred payment basis.

Standard Commodity Lending Terms:

• commodity loans are provided up to the equivalent of 85% of the total contract price;
• advance payment: 15% of contract price (VABank considers providing its client loans to cover this payment);
• payment deferment for up to 12 months;
• interest rates on commodity loans are much lower than on financial loans.

Contract Terms:

1. Our client may directly negotiate the terms and bank guarantees with an exporter;
2. Where export financing and lending bank's risks insurance is required, VABank may directly negotiate acceptability of its guarantee;
3. Financing bank's or exporter's risks may be hedged by a nation-wide insurance company in the exporter's country.

By providing bank guarantees to its regular and potential clients , VABank helps them obtain foreign commodity loans on their import transactions.

Guarantee execution mechanism and client checklist are similar to those for a financial loan.

Guarantees are available for VABank clients only.

Bank guarantee is granted provided:

• a client has a contract with a foreign manufacturer, setting forth a deferred payment purchase under our Bank's guarantee;
• foreign partners (exporters, foreign banks, insurance companies) are prepared to accept our Bank's guarantee.

The following source documents are required to assess whether a guarantee could be available:

1. Detailed application specifying nature of a transaction, and purpose and term of use of the requested documentary instrument (in the Bank's form);
2. Notarised Charter (for Bank clients, a copy);
3. Notarised incorporation agreement (for Bank clients, a copy);
4. Completed Bank's Client Questionnaire Form;
5. Transaction feasibility study stating its expected results;
6. Copies of contracts for which a guarantee is requested;
7. Statement of outstanding debts and of the past calendar year's current account activity;
8. In the event of a licensed transaction, copies of applicable licenses;
9. Applicant's complete quarterly tax returns for the past year;
10. Breakdown of client's payables and receivables for the last reported period;
11. Breakdown of fixed cash assets as of the last reported date;
12. Certified signature card;
13. Copy of Incorporation Certificate;
14. Copy of Statistics Ministry's Registration;
15. Copy of Tax Authority's Registration; copy of Taxpayer's Certificate;
16. Copy of Pension Fund's Registration;
17. Documents required to execute a collateral agreement.

VABank clients are offered free consultancy on closure of commodity credit lines, market surveys, advice, and assistance in negotiations with foreign banks and insurance companies.

VABank's reference list in commodity loan guarantees includes counterparts in Germany (Otto Wolf, Tіssen Krupp), Hungary, Czech Republic, Canada, and Finland.

For additional information:
Telephone: 490-06-88
Fax: 216-00-33
E-mail: