MinFin raises UAH 6 bln at weekly bond auction as interest rates rise

Ukraine’s Finance
Ministry raised UAH 6.0 bln at its weekly bond auction on Oct. 13, compared to
UAH 3.4 bln and USD 135 mln (the equivalent of UAH 7.2 bln) at the auction last
week. The auction receipts came from the placement of 6M, 1Y, 2Y and 3Y bonds.

One-year bonds had
the highest demand, and ten out of 13 bidders were successful in buying them
for UAH 1.9 bln at 10.0% (vs. 9.89% for these bonds last week). Another UAH 1.9
bln was brought by the sale of 6M bonds to two out of four bidders at 8.0% (the
same interest rate as two weeks ago).

Two-year bonds were
sold to four out of six bidders for UAH 1.1 bln with a weighted average
interest rate of 10.82% (vs. 10.5% for these bonds two weeks ago). On top of
that, MinFin satisfied three out of six bids for 3Y bonds for UAH 1.1 bln at
10.95%.

Evgeniya
Akhtyrko: It looks
like MinFin finally managed to boost UAH auction receipts amid hiked interest
rates. The one-year government bonds at around 10% are likely to be the
trade-off that most market players will agree upon for the nearest future.

Next week, we are
likely to see higher auction receipts as MinFin plans to offer one-year
USD-denominated bonds, which are likely to meet high demand. The
UAH-denominated offer will include 3M, 1Y and 3Y bonds.