MinFin bond auction receipts jump to UAH 3.5 bln

23 February 2022

Ukraine’s Finance Ministry raised UAH 3.3 bln and EUR 7.2 mln (the total equivalent of UAH 3.5 bln) at its weekly bond auction on Feb. 22 after raising UAH 0.7 bln last week. The auction receipts came from the sale of 3M, 1Y, 1.5Y, 2Y and 5Y UAH denominated bonds as well as 3M EUR denominated bonds. MinFin satisfied all bids, while the bidders were unanimous in their pricing for each type of offered bonds.

 

The lion’s share of the auction receipts – UAH 3.0 bln – came from the sale of 3M bonds which were sold to five bidders with an interest rate of 11.60%. Three participants bought 1Y bonds for UAH 228 mln at 11.93%. The sale of 1.5Y bonds to five bidders at 12.00% brought UAH 26 mln. Nine bidders bought 2Y bonds for UAH 27 mln at 13.00%. The sale of 5Y bonds to four bidders at 13.09% brought UAH 4 mln. The rates on all such bonds remained unchanged compared to the previous placements.

 

EUR denominated bonds were sold to four bidders at 1.75%.

 

Evgeniya Akhtyrko:  The latest auction was likely just the sale of the bonds to a predetermined list of bidders at previously agreed prices. The involvement of state-owned banks in purchasing UAH denominated bonds was likely high, if not absolute.

 

MinFin sold 3M EUR denominated bonds instead of the previously announced 6M bonds in order to draw at least some demand for local Eurobonds amid the incredibly high risks. In February, the rollover on local Eurobonds was very low. During the month, the government redeemed local Eurobonds for USD 368 mln and EUR 349 mln, while the receipts from the sale of local Eurobonds in February amounted just USD 16.8 mln and EUR 7.2 mln.

 

Next week, MinFin is to offer six types of UAH denominated bonds with terms of maturity ranging from six months to four years as well as 2Y USD denominated bonds.

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