Liquidity reallocation

Обзор облигаций 02.06.2015 Funds were reallocated from CDs to banks' correspondent accounts last Friday as broader liquidity rose a slight UAH0.12bn to UAH57.15bn. Banks' correspondent accounts with the NBU rose UAH2.32bn to UAH23.35bn while total CDs outstanding fell UAH2.20bn to UAH29.44bn and total local currency debt repayments scheduled for the next 30 days remained steady at UAH4.36bn. Investment implications: This reallocation of funds prior to the last day of month-end tax payments was likely an attempt by banks to keep their liquidity stable amidst a high level of outflows. We could see liquidity decline today prior to the standard recovery seen at the beginning of any month.