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Concorde Capital Research: Ukraine raises UAH 6.6 bln from local bonds

March 04, 2020 | Cbonds

Ukraine’s Finance Ministry raised EUR 201.3 mln and UAH 1.0 bln (the equivalent of UAH 6.6 bln) at its weekly bond auction on March 3 after drawing UAH 1.5 bln at the auction last week. The auction receipts came from the placement of 9M EUR-denominated bonds and 6M UAH-denominated bonds.

MinFin satisfied 17 out of 25 bids for 9M EUR-denominated bonds for EUR 201.3 mln with a weighted average interest rate of 2.22% (the same rate as for 6M EUR-denominated bonds placed on Dec. 17).

Five out of eight bidders were successful in buying 6M UAH-denominated bonds for UAH 1.0 bln with a weighted average interest rate of 9.9% (vs. 9.6% for comparable bonds placed a month ago), while the MinFin’s cut-off rate was 10.0%.

Evgeniya Akhtyrko: Our expectation was on the mark that the government might resort to the placement of local Eurobonds to increase auction receipts amid dropping demand for UAH-denominated debt. Recall, the initial MinFin plan for 1Q20 local bond auctions didn’t include the placement of local Eurobonds.

Despite a noticeable climb in interest rates, the demand for short-term UAH denominated bonds was relatively low. We expect the interest rates for UAH-denominated debt to rise above 10% in the next local bond auctions.

Company: Ukraine

Full company nameUkraine
Country of riskUkraine

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