Bondholders may apply a haircut for 20% of Ukrainian debt
The agreement is not conducted, but it is expected to be reached in September
“Ukraine’s government is nearing a restructuring deal with its creditors that would call for a 20% reduction in the value of the country’s bonds, marking a possible breakthrough in negotiations that have been deadlocked for months, according to people familiar with the matter," writes The Wall Street Journal.
The 20% “haircut” is the fine line between Ukraine and the creditors, as previously Ukraine insisted on 40% reduction. Ukraine needs the restructuring, and it is connected with the next IMF tranche. Currently, the deal is not conducted yet, but there is a high probability of its signing in September this year.
As was reported before, the next $500 mln Eurobond payment is scheduled on September 23. Ministry of Economy stated that Ukraine really relies on the restructuring opportunity, otherwise, the country would be forced to take some alternative mechanisms of financing.
Since March, Ukraine is holding restructuring negotiations with the creditors. The counry has made a $60 mln coupon payments on a $1.5 bln Eurobond due February 2021.
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