Reprofiling of NBU's government bond portfolio could start in week or two – Finance minister
The Ukrainian government has finished preparations for the Reprofiling (restructuring with expansion of maturity term) of the government domestic loan bond portfolio of the National Bank of Ukraine (NBU) and the work at the NBU will be finished in a week or two before the start of the transaction, Ukrainian Finance Minister Oleksandr Danyliuk has said.
"The government has completed its work. We approved the reprofiling conditions. Now the documents are at the NBU. The NBU external auditors are analyzing them. I think that this would be finished in a week or two, and then we will be able to start this transaction," he said in parliament on Friday.
Ukrainian Prime Minister Volodymyr Groysman said that he shares alarm of lawmakers with the course of the reprofiling. He said that this was a joint initiative of the coalition, the Ukrainian president and government aimed at attracting an additional UAH 15 billion in 2017 for construction and reconstruction of roads.
"I have sent a letter to the NBU and there is an order to the Finance Ministry to start preparations for the reprofiling… Now it is the NBU to act. Our task is to find the tools to implement the task jointly with the NBU. They are behind the schedule now. We will insist on finalizing the issue," the prime minister said.
He added that the reprofiling issue is a top priority for Ukrainian President Petro Poroshenko. He is seriously working on it.
"I am sure that this year we would achieve making this decision. We understand that the National Bank is an independent regulator," Groysman said.
As reported, according to the NBU's assessments, the restructuring of its government domestic loan portfolio could be reduce expenses of the Finance Ministry on this debt by UAH 33 billion in 2017, from UAH 47 billion to around UAH 14 billion.
It is planned that the securities would be converted into long-term hryvnia-pegged bonds. Their yield would be linked to inflation. The term of 30 years was discussed at that moment. However, this reprofiling would result in the reduction of NBU's payments to the 2018 national budget, as it would cut its profit for 2017.
