Valeriy Povreznyuk, Director of the Project Finance Center of JSCIB UkrSibbank
As per definition of a banking product, all project finance is a long-term lending. In UkrSibbank practice currently financed projects have a lending period of 3.5 - 10 years. Average period is 7 – 9 years. The period depends, first of all, on a project payback period. 3-4 years ago the projects got paid back within 2-3 years, a year or two ago – within 4 -5 years.
At present this period is on the average 6 – 7 years, depending on the segment of economy and project location. In Kyiv the competition is stronger, and payback takes longer. In many regions the competition is weaker, and the situation is vice versa. The shortest term regarding volumes for sale constitutes: construction period plus period for sale of object. Long-term loans are always of specific nature, that’s why it’s difficult to determine in advance the period, for which the bank will extend financing. For example, if nowadays commercial real estate is paid back within 6 - 7 years, then the period of finance provided varies between 7 and 9 years.