June 24, 2020 | Cbonds
|Ukraine’s Finance Ministry raised UAH 6.2 bln at its weekly bond auction on June 23 after raising UAH 2.0 bln at the auction last week. The auction receipts came from the placement of 3M, 6M, 9M,1Y, 2Y and 3Y bonds.|
More than half of auction receipts – UAH 3.9 bln – came from the sale of 1Y bonds to eight out of nine bidders with a weighted average interest rate of 9.7%. (vs. 10.9% for the same bonds two weeks ago). The second largest receipts – UAH 1.1 bln – came from the sale of 2Y bonds to 11 out of 17 bidders with a weighted average interest rate of 10.39% (vs. 10.57% for the same bonds last week).
MinFin satisfied three out of five bids for 3M bonds for UAH 533 mln at 7.24% (vs. 7.5% for the same bonds last week). In addition, three out of four bidders were successful in buying 6M bonds for UAH 484 mln with a weighted average interest rate of 7.71% (vs. 8.0% for these bonds last week)
The rest of auction receipts came from the sale of 3Y and 9M bonds. In particular, three out of five bidders were successful in purchasing 3Y bonds for UAH 126 mln with a weighted average interest rate of 10.47% (vs. 10.76% for these bonds last week). On top of that, the government received UAH 113 mln from the sale of 9M bonds to three out of four bidders at 9.5% (vs. 10.7% for these bonds two weeks ago).
Evgeniya Akhtyrko: It looks like MinFin decided to tap market demand for bonds with longer terms of maturity, slashing rates for 3M and 6M more intensively. This readiness of market participants to buy bonds with longer terms of maturity points to lower risk assessments and less uncertainty.
We expect MinFin to extend its bearish play and bring interest rates for 2Y and 3Y bonds to the single digits very soon.
|Full company name||Ukraine|
|Country of risk||Ukraine|