Ukraine local bond auction revenue plunges to UAH 185 mln

2018/4/4 23:40:54

Analyst: “The abundant bond placement in March auctions, which raised UAH 29.0 bln, has enabled the government to take a breather from piling up debt to cover shortages. However, this situation is not likely to last long, as the results of 1Q18 budget revenue collection point to the inability of Ukraine’s economy to ensure smooth budget revenue growth.’”

 


KYIV, Apr 4, 2018.-. The weekly local bond auction held by Ukraine’s Finance Ministry on Apr. 3 raised only UAH 185.3 mln, a fraction of the UAH 20.3 bln raised last week, Concorde Capital informed clients in an online advisory today. The government drastically reduced its offer of debt securities, pitching only 3M bonds while the preliminary schedule included the placement of 6M, 1Y and 2Y bonds as well.

 

 The scarce government offer attracted 22 bids, 19 of which were accepted. The auction cut-off rate was 17.44% while the bidders requests ranged from 17.0% to 17.5%. The weighted average rate for placed 3M bonds was 17.33%, the same as for the 70-day bonds placed last week.

 

Concorde analyst Evgeniya Akhtyrko added: “Apparently, MinFin decided to limit its primary placement to the shortest bonds in order to prevent the growth of state debt costs, given the current high interest rates. The abundant bond placement in March auctions, which raised UAH 29.0 bln, has enabled the government to take a breather from piling up debt to cover shortages. However, this situation is not likely to last long, as the results of 1Q18 budget revenue collection point to the inability of Ukraine’s economy to ensure smooth budget revenue growth.’

 

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For more information, link here: www.concorde.ua 

 

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