EBRD AAA rating affirmed as Fitch flags Ukraine-related credit risks

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EBRD AAA rating and Ukraine risks

Highlights

Fitch affirms EBRD's Long-Term Issuer Default Rating at 'AAA' with a Stable Outlook, citing excellent capitalization ratios—44% usable capital to risk-weighted assets and 29% equity-to-assets at end-2025.
New EUR4 billion capital increase, with EUR1.5 billion received by end-1H26, supports policy importance and mitigates increased credit risks from expanding Ukraine exposure.
EBRD's net exposure to Ukraine rises to EUR4.3 billion (8.8% of total banking exposure) at end-2025, with 60% of Ukrainian loans non-performing in 1H26 and rising NPL ratio expected above 6%.

Rating rationale and capital support

As reported by Fitch Ratings, the agency has affirmed EBRD's Long-Term Issuer Default Rating at 'AAA' with a Stable Outlook, with the rating reflecting the bank's standalone credit profile of 'aaa'. Fitch says the profile is based on a solvency assessment of 'aa+' and a low-risk business environment, which results in a one-notch uplift over the lower of the solvency and liquidity assessments.

Fitch says EBRD's excellent capital position remains a core support for the rating. Its usable capital to risk-weighted assets ratio stands at 44% at end-2025, while the equity-to-assets ratio is 29%, both above Fitch's thresholds for an excellent capitalization assessment.

The agency also points to shareholder backing through the EUR4 billion general capital increase approved in December 2023 to support Ukraine. Paid-in capital contributions begin at end-2024, and EBRD has received EUR1.5 billion by end-1H26, reinforcing the bank's policy importance and providing additional support for capital ratios.

Ukraine exposure shapes risk outlook

Credit risks remain the main constraint on EBRD's solvency assessment as the bank increases its activity in Ukraine. Fitch-adjusted non-performing loans stand at 2.0% at end-1H26, up from 1.5% at end-2025, and the agency expects the ratio to rise above 6% again as Ukrainian exposure grows.

The average rating of loans and guarantees before preferred creditor status is 'BB-' at end-2025, unchanged from a year earlier, but Fitch expects this to weaken to 'B+' over the forecast horizon. The shift mainly reflects higher exposure to Ukraine, although donor-funded guarantees partly mitigate the effect.

EBRD commits EUR4.8 billion of new investments in Ukraine across 2022, 2023 and 2024, with about half of the risk on average covered by pari passu or first-loss shareholder guarantees. New investment in Ukraine since the start of 2025 totals EUR2.3 billion in 2025 and EUR0.9 billion in 1H26, with donor guarantees focused on priority projects.

Net exposure to Ukraine rises to EUR4.3 billion, or 8.8% of total banking exposure, at end-2025 from EUR3.1 billion, or 7.0%, at end-1H24. Fitch notes that 60% of loans to Ukrainian counterparties are non-performing in 1H26 under EBRD's definition, though a EUR0.9 billion loss provision and what the agency describes as prudent reserving should help limit additional war-related losses.

Fitch also highlights EBRD's strong liquidity and market access as rating strengths. The bank's liquid assets cover short-term debt by 3.5 times at end-2025, and treasury assets account for 45% of total assets, supporting an 'aaa' liquidity assessment.

Our earlier article covered EBRD’s plans to keep Ukraine funding near record levels into 2026, with most lending directed to the private sector despite continued attacks on energy and transport infrastructure. It also highlighted specific emergency and infrastructure-backed financing—such as support for Ukrainian Railways, Kyiv metro rolling stock, grid protection, and renewables—alongside a trimmed 2026 growth forecast reflecting elevated wartime risks.

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