19:04 14.01.2022

Ukrainian eurobond rates collapse again on Friday

2 min read
Ukrainian eurobond rates collapse again on Friday

Deteriorating expectations of market participants regarding a possible Russian attack on Ukraine led to a new fall in Ukrainian eurobond quotes on Friday by 2.5-3.6% (depending on the maturity).

According to Bloomberg quotes, the price of the shortest maturing notes this year lost 2.8%, as a result of which the rate on them jumped from 14.25% to 19.5%.

Eurobonds maturing in 2023 decreased in price by 2.5%, which led to an increase in yield from about 12.2% to 14.1%.

Falling prices of eurobonds maturing in 2024-2025 by 3-2.5% led to an increase in their profitability by almost 1.7-1 percentage points, to about 13.5% and 12.2%, respectively.

Rates on securities maturing in 2026-2027, which fell by about 3% on Thursday, reached 11.5% and 11%, respectively.

Only the longest eurobonds maturing in 2032, although they lost in price more than others – almost 3.6%, still retain the lowest yield to maturity – 10.6% per annum, emphasizing a pronounced inversion of the yield curve ( when the rates for short securities are higher than for long).

In addition, after falling by almost 7% the day before, VRIs also fell by 2.7% on Friday: now their price is about 77.3% of the nominal value.

The sale of Ukrainian securities also affected the issues of corporate eurobonds. In particular, the securities of the MHP agricultural holding maturing in 2024, after falling by 1.1% on Thursday, fell another 3.3% on Friday, as a result of which, in two days, their yield to maturity grew from 7.7% to 10.1% per annum.

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