Finance Ministry attracts UAH 348 mln, average yield down to 8.2%

At a primary sovereign bond auction yesterday, Ukraine’s Finance Ministry sold UAH 348 bln (USD 43.8 mln) in UAH bonds, 45% less than at last week’s auction, Interfax reported. The average yield declined to 8.2% from 9.1% a week before. Mykyta Mykhaylychenko: The government now has low short-term liquidity needs after placing USD 2 bln in Eurobonds last week and can allow low placement volumes. Three-month papers (with maturity this December) with a notional value of UAH 115 mln were sold at a 6% average yield (down from 6.75% at the beginning of September), and 9-month papers with a notional value of UAH 250 mln were sold at 9.25% (down from 9.5% two weeks ago). Importantly, though, only one bid was satisfied for 3-month papers (out of 16 bids with the lowest bid with 8% YTM) and two bids were satisfied for 9-month papers (out of 30 bids with the lowest bid with 11% YTM), suggesting yields would have been higher if other bids were satisfied.