Unscheduled FX financing

Обзор облигаций 12.12.2014 Following Tuesday's successful auction that raised significant funds, the MoF held an additional auction yesterday also offered a USD-denominated bond. UAH1.50bn of bonds at the standard 17.60% was sold, providing the state budget with a total of UAH4.5bn this week. Investment implications: FX-denominated bonds are rarely offered not often and demand was minimal at best. Although the MoF anticipated no demand for FX-denominated bonds, following the US$233.87m repayment made on Wednesday, the MoF scheduled an immediate refinancing because of upcoming FX repayments. While scheduled domestic payments amount to US$107.20m through the end of this year and US$153.45 in the first week of 2015, external debt will require an additional US$235.05m. As a first step in refinancing upcoming FX repayments, possibly from a bank that received a recent FX redemption, the MoF has FX-denominated bonds offering scheduled for next week's auction.