Liquidity continues to recover

Обзор облигаций 11.06.2015 Banks' correspondent accounts with the NBU increased UAH1.51bn to UAH22.27n yesterday while total CDs outstanding slid UAH0.17bn to UAH34.29bn. Total debt repayments scheduled for the next 30 days remained steady at UAH5.19bn. Broader banking sector liquidity rose UAH1.34bn to YAG61.75bn, setting this month's record high. Investment implications: Although the NBU issued no new loans for banks on Tuesday, it purchased about UAH2.50bn of new government bonds. As evidence that this must have occurred, no other bondholders' portfolios rose even though total bonds outstanding increased, as reported by the NBU. The bonds must have been issued for DGF, and were immediately purchased by the NBU, as either Naftogaz bonds or bonds from banks' portfolios could be not purchased immediately as occurred yesterday. As a result, liquidity continued to recover slightly without significant outflows.