Ukraine bond auction receipts surge to UAH 12.5 bln

Ukraine’s Finance Ministry raised UAH 10.2 bln and USD
85.2 mln (a total of UAH 12.5 bln in the equivalent) at its weekly bond auction
on March 19 after raising UAH 3.5 bln in the equivalent
at the auction last week. The government placed seven types of UAH-denominated
bonds with terms of maturity ranging from four months to three years and 3M, 1Y
and 2Y USD-denominated bonds.

Half of the UAH auction receipts – UAH 5.1 bln – came
from the sale of 4M bonds to 18 bidders at 19.5%. Four bidders paid UAH 3.4 bln
for 2Y bonds with a weighted average interest rate of 17.98%. Ten bidders
bought 6M bonds for UAH 615 mln with a weighted average interest rate of
18.99%. The government satisfied six out of seven bids for 9M bonds with a
weighted average interest rate of 18.49%, raising UAH 590 mln. Two bidders
bought 18M bonds for UAH 491 mln at 18.25%. In addition, the government
satisfied all seven bids for 1Y bonds for UAH 35 mln at 18.5% and one out of
three bids for 3Y bonds for UAH 31 mln at 17.25%.

The government satisfied all bids for USD-denominated
bonds. The lion’s share of the USD auction receipts – USD 80.7 mln – were
raised by the sale of 3M bonds to 13 bidders at 6.5%. Ten bidders bought 1Y
bonds for USD 2.0 mln at 7.25% and 2Y bonds for USD 2.5 mln at 7.5%.

Evgeniya Akhtyrko: Investing
in UAH-denominated government bonds is very rewarding at the moment as interest
rates remain high amid the central bank’s decision to keep the key policy interest rate at 18%.
As at the prior auction, a significant share of UAH auction receipts came from
the sale of 2Y bonds. This a positive development indicating some growth in
investor confidence.

The higher USD receipts from the newly placed bonds
should help the government deal with the redemption of local Eurobonds for USD
113.0 mln on March 21.