Ukraine state debt grows 0.4% in June

Ukraine’s state debt grew 0.4% m/m, or USD 330 mln, to
USD 75.0 bln in June owing to further hryvnia strengthening, the Finance
Ministry said on July 26. Through the month, the national currency appreciated
1.0% to UAH 26.1/USD, thus slightly increasing the state debt denominated in
USD. In the meantime, UAH-denominated debt dropped 0.5% m/m, or UAH 10.3 bln,
reflecting repayments on local state bonds. The share of external debt
increased to 64.3% from 64.1% in the prior month.

Alexander Paraschiy: June was
silent in terms of debt operations. July will bring an internal debt increase
of UAH 22.5 bln from the recapitalization of the nationalized Privatbank.
Further debt growth totally depends on whether Ukraine secures the next IMF
loan tranche. Two week ago, pension reform was approved by parliament in the
first reading, which greatly improved the chances for one more wire of USD 1
bln by the year end. In which case, we see good chances for a USD 0.5 bln
Eurobond placement. We project the state debt to reach USD 76.3 bln (75.0% of
GDP) by the year end.