Fixed Income
August 06, 2012
Yields on Ukrainian corporate Eurobonds contracted sharply in 1H12 amid a reassessment of the country’s sovereign risk by investors. Prices for most banking sector issues rose by about 10% in the period, compared to an average 5.5% appreciation in sovereign papers. PrivatBank-16s were the best performer, jumping by 16.4% from 58.0/63.0 in January to 68.0/72.0 in July. Taking into account that Ukraine’s balance of payments is set to improve in 2H12 and that concerns of an uncontrolled hryvnia devaluation are therefore easing, we think that selected issues offer quite attractive yields. In this fixed income report we present an overview of 12 Ukrainian bonds, which in our opinion are the top trading ideas for 2H12.
