The international rating agency Fitch claimed that return of Ukraine to the international loan market shows the strengthening of the economy but it does not reduce its dependence on the IMF financing. It is stated in the press release of the agency published on September 22.
The agency noted that the attraction of 3 billion dollars by Ukraine from the bond offering will decrease the risk of consolidation but increase the currency reserves.
‘The high demand shows the progress reached by the Ukrainian authorities in the elimination of the economic misbalances and strengthening of the macroeconomic policy of the country. The dealing decreases the risk of the consolidation because part of the earnings will be used for a buy-out of the bills of credits with the expiration date in 2019 and 2010 in the amount of 1.6 billion of dollars. It will increase the reserves that increased to 18 billion dollars from 15.4 billion dollars even more. It increased particularly due to the last IMF allocation, the second payment within EU micro financial support program in the amount of 600 billion dollars and sale of the funds to the residents’, the message said.
Fitch added that the main source of financing for Ukraine will be the loan program of the IMF.
‘The stable access to the bond markets will improve the changeability of the external financing but while Ukraine does not restore the reputation of the issuing then the multilateral and bilateral support will remain to be the key resource of the external account and budget financing. Fitch does not expect the strong growth of the flow-in of the Straight Foreign Financing in 2017-2018 and the official allocations, mostly from the IMF will provide the major part of the external financing’, the agency added.
Earlier President Petro Poroshenko claimed on the return of Ukraine to the international loan market in the result of the meeting with the investors in New York. Ukraine was able to attract three billion dollars for 15 years from the bond offering.
The deal was organized by BNP Paribas, Goldman Sachs and JP Morgan. The road show of Eurobonds was held last week in London, Boston and New York. During the collection of applications, Ukraine managed to significantly reduce the yield of the issue: the initial benchmark was 7,75%, then it was lowered to about 7,625 and the final range was 7,375-7,5%, the placement will be made at its lower index. Debt securities of the country enjoyed considerable demand among investors - the volume of the book of applications, according to preliminary data, amounted to about 9,3 billion dollars.