“Stretch to tranche”. Kiev took a loan for $725 million

"Протянуть до транша". Киев взял займ на $725 млн

This allows you to satisfy short-term needs for foreign exchange liquidity, saying the Ministry of Finance.

Ukraine entered the international capital market with private placement of bonds of external state loans, the press service of the Ministry of Finance.

“The Ministry of Finance made a private placement of short-term bonds issued maturing in 2019 at $725 million the USA”, – stated in the message.

The Ministry said that the bonds were placed among the leading international investors who have provided the financial support to Ukraine in the conditions of instability of the international capital market for developing countries.

“This operation allows Ukraine to meet its short-term need for foreign exchange liquidity and to benefit from flexible conditions of attracting funds”, – noted in the Ministry of Finance.

As noted, the Ministry of Finance will continue to implement the approved strategy of public debt management, and plans to fully implement the plan of state foreign borrowings by attracting funds from both commercial and official creditors.

“The Ministry of Finance will continue to actively monitor market conditions and implement internal plans of borrowing”, – said the Agency.

Managing partner of investment company Capital Times Eric Naiman called placement of Ukrainian securities internally. According to him, the money are “unrealistically expensive” the interest of 9.10-9.15% per annum.

“Forced transaction. Of course is really expensive. Trigger whether it is the sale of Ukrainian Eurobonds in the market? Maybe Yes. After all, the yield of Ukrainian Eurobonds with maturity in 2019, far below: 6.76% per annum… However, while such behavior of the Ministry of Finance only shows all the more taut tightening the debt noose around the neck of Ukraine”, – writes Naiman in Facebook.

Strategist for emerging markets at Bluebay Asset Management Tim ash, in turn, noted in an interview with Bloomberg that the borrowing will allow Kiev to “stretch” to get the next tranche of the IMF.

Earlier, Prime Minister Vladimir Groisman said that the non-payment of external debt threatens Ukraine with default. To avoid this, you need to cooperate with the IMF, said the Prime Minister.

As you know, the IMF mission will arrive in Ukraine with a two-week visit on 6 September. Ukraine may receive the next tranche from the IMF in the autumn.


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