MinFin to attract EUR 250 mln loan from Cargill
26 July 2019
Ukraine’s Cabinet of Ministers decided on July 10 to
attract EUR 250 mln in loans from Cargill Financial Services International,
Interfax-Ukraine reported on July 25, citing the government’s official
newspaper. The loans will consist of two tranches, the first being EUR 100 mln
for two years with an interest rate of 5.15%, the second is EUR 150 mln for
five years at a 6.25% rate. Interests on the loans will be paid quarterly.
The Cabinet resolution does not specify when the loans
are going to be taken, which it indicated would be agreed upon in loan
agreements to be concluded between the lender and the Finance Ministry.
Alexander Paraschiy: It’s
positive that the Finance Ministry has an option to borrow from a private
international company, but it will not necessarily use such an option.
The rates on Cargill loans look in line with the
rates at which MinFin attracted its EUR-denominated Eurobond in late June
(6.75% for seven-year bond). However, since that time, yields on Ukrainian international
bonds have plunged (YTM on the seven-year bond was 6.0% on July 9 and it’s 5.0%
today), making the Cargill loan not much attractive now.
