MinFin raises UAH 10.4 bln at local bond auction

Ukraine’s Finance Ministry raised UAH 8.4 bln, EUR
42.0 mln and USD 21.5 mln (the total equivalent of UAH 10.4 bln) at its weekly bond
auction on April 27 after raising UAH 4.6 bln at the auction last week. The
auction receipts came from the placement of 6M, 12M, 20M, 2Y  and 3Y UAH
bonds, 1Y USD bonds and 1Y EUR bonds.

More than half of auction receipts – UAH 5.7 bln –
came from the sale of 1Y bonds to 26 bidders at 11.20% (vs. 11.15% for the same
bonds last week). Nine bidders bought 20M bonds for UAH 1.2 bln at 11.30% (the
same rate for these bonds as a week ago). MinFin satisfied all 15 bids for 3Y
bonds for UAH 860 mln with a weighted average interest
rate of 12.38% (vs. 12.05% for these bonds three weeks ago).

In addition, 12 out of 14 bidders were successful in
purchasing 2Y bonds for UAH 436 mln with a weighted average interest rate of
11.96% (vs. 11.80% for these bonds three weeks ago). On top of that, UAH 120
mln came from the sale of 6M bonds to eight out of 12 bidders with a weighted
average rate of 9.00% (vs. 8.07% for these bonds two weeks ago).

MinFin satisfied all bids for local Eurobonds. In
particular, 17 bidders bought 1Y EUR denominated bonds for EUR 42 mln at 2.5%,
while 32 bidders invested USD 21.5 mln in buying 1Y bonds at 3.7%.

Evgeniya Akhtyrko: This week,
MinFin’s offer received a better response from the market. Apparently, the
market’s expectations improved amid the lowered risks of military escalations.
The higher interest rates also helped to increase investors’ activity.

The next MinFin auction is scheduled for May 11. The
government will offer six types of UAH denominated bonds with maturity from six
months to six years as well as 1Y EUR denominated bonds. We expect the auction
receipts to be similar to the latest auction if the political situation doesn’t
deteriorate.