MinFin local bond auction receipts drop to UAH 2.3 bln

Ukraine’s Finance Ministry raised UAH 2.3 bln at its weekly
bond auction on Feb. 5 after drawing UAH 6.3 bln at the auction
last week. The auction receipts came from the placement of 6M,
16M, and 3Y bonds.

Around a half of auction receipts – UAH 1.1 bln – came
from the placement of 16M bonds, which were sold to nine out of 12 bidders with
a weighted average interest rate of 9.77%

The second-highest receipts – UAH 944 mln – came from
the sale of 3Y bonds to 25 out of 26 bidders with a weighted average interest
rate of 9.84%. In addition, MinFin satisfied four out of seven bids for the
purchase of 6M bonds for UAH 271 mln with a weighted average interest rate of
9.60% (vs. 10.03% for the same bonds two weeks ago).

Evgeniya Akhtyrko: Auction
receipts plunged from the impressive results of the other three auctions in
January. The relatively weak receipts from 3Y bonds indicate that nonresident
investors are participating less.

We should wait for the results of two more auctions in
order to conclude whether the interest of non-resident investors in Ukraine’s
local bond market is truly fading.

At the auction next week, MinFin will offer 3M, 1Y,
2Y and 4Y bonds. Interest rates for 3M bonds are likely to drop below 10% (vs.
10.15% last week).