Fixed Income
Ukrainian sovereigns finally snapped out of their three-month funk last week, rising sharply after the US Federal Reserve left its quantitative easing policy unchanged and the Ukrainian government raised a new external loan in the amount of USD 750mn. The loan was arranged, and also presumably extended by, Russia’s state-owned Sberbank. Sberbank CIB (the group’s investment banking arm) said the effective rate for the facility is approximately 8%. However, Ukraine’s 5-year credit default swaps (CDS) did not show a positive reaction, ending at 890 basis points on Friday (Sept 20). Benchmark Ukraine-23s jumped 4.4%, finishing at 88.7/89.3 (9.3%%/9.2%) and medium-term Ukraine-17s rose 3.2% to 92.0/92.8 (9.1%/8.9%). Quasi-sovereign Naftogaz-14s added 0.6% to close at 98.3/99.1 (11.4%/10.5%). Corporate issues also ended higher, although by less than the sovereigns. Ferrexpo-16s rose by 0.8% to close at 96.1/97.3 (9.6%/9.1%) and Metinvest-18s climbed 0.4% to 93.5/94.3 (10.6%/10.4%). In top b
