Fixed Income
Ukraine imposed a moratorium on debt servicing last week in the frame of its Eurobond restructuring process. The Finance Ministry expects to exchange all 14 outstanding issues for 9 new ones with maturity in 2019-2027 by the end of November. Importantly, reports have emerged that holders of the two maturing Ukraine-2015 issues will be able to exchange them for the new 2019 bonds instead of a mix with the longer maturities, implying somewhat better treatment compared to other private creditors. Quotes for Ukraine-15s, which are de-facto in default as their maturity date was Sept 23, traded at 78.0/79.5 cents on the dollar, about 1.5p.p. higher than other outstanding bonds. Benchmark Ukraine-23s edged up 0.6% to close at 76.5/78.5 (13.2%/12.7%) and Ukraine-16s rose 1.0% to 76.5/78.0 cents. Corporate debt papers were mixed. Ferrexpo-19s continued to suffer losses after the company admitted holding USD 174mn of deposits in related-party Finance&Credit Bank, which was declared insolven
