By Rachel Savage

LONDON, (Reuters) – The European Bank for Reconstruction and Development stated on Thursday that Russia’s invasion of Ukraine will have a major impact on their finances in 2019. It reported the highest profit it has ever recorded in 2021.

Monday’s suspension of Russia and Belarus by the EBRD meant that their profit last year, 2.5 billion euro ($2.72billion), was higher than its record in 2006.

This was due to the “excellent performance of its equity investments and technology investments.” It also noted a decrease in non-performing loans after economies had recovered from the coronavirus epidemic.

But, the bank warned that it would be affected by the effects of war in Ukraine on its financials. The bank is offering a 2Billion Euro support package to Ukraine. Last week, its chief economist stated that Ukraine’s economy will shrink 20% this fiscal year, even if there’s a ceasefire.

According to the EBRD, “The conflict in Ukraine will likely have a substantial impact on 2022’s financial performance.” “The EBRD owns a substantial portfolio of equity and investments in Ukraine as well as in portfolios in Belarus, Russia, and Belarus.”

The company stated that it owned loans in the amount of 2.1bn euros to Ukraine, 0.25 billion euros for Russia, and 0.5bn euros in Belarus at the end 2021. Additionally, equity exposures of 0.3bn, 1.2bn, and 0.1bn euros were held by the three.

The majority of the EBRD’s assets are owned by G7 leaders in economic power.

Since Moscow annexed Crimea and Belarus in 2014, the EBRD did not send any new funds to Russia.

($1 = 0.9194 euros)