Fixed Income
Ukraine’s sovereign Eurobonds sold off heavily again last week, with the yield on the benchmark long-term issue rising above 10% amid an apparent stalemate over how to lower the temperature of the country’s tense political standoff. Meanwhile, the government remains without obvious sources to finance external repayments coming due this year, and this hit quotes for short-term Ukraine-14s maturing in June, which fell by 1.4% to 95.6/97.1 (24%/18%). Ukraine-23s got hammered, falling 4.9% to 82.3/83.8 (10.6%/10.3%), while Ukraine-17s slid by 2.2% to close at 85.2%/86.9% (11.8%/11.1%). Banking sector debt looked even worse than the sovereigns, as a second-tier institution, BrokBusinessBank, faced liquidity problems and was forced to ask the NBU for help. The 2018 Eurobonds of state-owned UkrEximBank plunged by 6.0% to 71.9/73.8 (19.3%/18.4%), and PrivatBank-16s were down 6.0% to 67.9/73.6 (28%/23%)
