Fixed Income
December 14, 2015
Ukraine’s newly-restructured sovereign Eurobonds were mixed last week, as the positive news that the IMF decided soften its policy on lending to countries in default had been expected and was already priced in by the market. Previously, the IMF’s policy prevented lending to countries in default to sovereign creditors, so this change removes a potential obstacle for a resumption of the flow of bailout cash to Ukraine, since Kyiv is expected to default on a Russian-held bond later this month. Ukraine wants the USD 3bn bond, which matures on Dec 20, to be restructured under the same agreement reached with commercial creditors that slashed the principal of outstanding debt by 20%.
