Business in frontline regions remains solvent: data from the National Bank

Resilience of business in frontline regions of Ukraine

According to ХВИЛЯ: Business in the frontline regions of Ukraine demonstrates resilience despite war risks, maintaining solvency and increasing credit portfolios. This is confirmed by a new Financial Stability Report prepared by the National Bank. According to the data, since mid-2024, the pace of new loan issuance in frontline zones has become comparable to the figures in safer regions.

One of the important factors influencing this situation is the government's spread of financial guarantee programs to risky territories. This allows reducing risks for creditors and stimulates business development in challenging conditions. In addition, mechanisms for compensating war-related losses have been introduced by the Export Credit Agency, which also contributes to maintaining the solvency of enterprises.

Main factors for restoring creditors' trust

To restore creditors' trust in wartime, three main 'pillars' can be identified:

• state guarantees,
• risk insurance,
• business adaptation to new conditions.

These measures allow not only to support existing enterprises but also to create new opportunities for economic development in frontline regions.

In the context of war and economic instability, it is important to emphasize that businesses in frontline areas are finding ways to adapt and grow. The introduction of government support programs, such as financial guarantees and compensation mechanisms for losses, plays a key role in maintaining the stability of enterprises. These initiatives not only help support businesses but also contribute to the recovery of economic activity, which is critically important for the overall recovery of the country. In the long term, the resilience of business in these regions may serve as a foundation for economic growth after the conflict ends.