Page 80 - UKRRptFeb24

8.5 Fixed income
Eurobond prices are up amid lingering uncertainty about US aid. According to ICU, Ukrainian Eurobond prices rose at the end of January in response to the anticipated approval of the EU aid package for Ukraine, while assistance from the US is still uncertain. Last Tuesday ended a nearly two-week-long downward trend for Ukrainian Eurobonds; their prices rose by 3% on average to 23/31. The price range for Eurobonds with different maturities tightened to 12.6%. The price of VRIs was up by 0.5%, staying below 47 cents per dollar of notional value. The EMBI index slid by 0.2% last week. As ICU explains, last week's Eurobond prices recovered some of the losses from the past two weeks. The chances are high that a financial aid package from the EU will be approved this week. This may further support Eurobond prices. Meanwhile, bondholders are keeping a close watch on the progress with further assistance from the US. An IMF mission will start in February that will review the EFF program and may approve the restructuring terms for the Ukrainian paper. All these factors together will be decisive in determining Eurobond prices in the coming weeks.
Security investments are gaining momentum in Ukraine: the number of investors has increased by 34%. According to the Settlement Center for Servicing Contracts in Financial Markets, registered investors in securities in Ukraine increased by 34%, or by 46,000, in 2023. The volume of operations with hryvnia bonds of the domestic state loan (OVDP) in December amounted to ₴29.6B (-32.5% compared to November), and the number of transactions also decreased by 5%, to 20,900. At the same time, 4,500 transactions were conducted with dollar OVDPs (+41%), but their volume significantly reduced to $99.4M. The number of transactions with OVDP in euros in December amounted to 350, and their volume was €5.4M, while in November, there were 310 such transactions for €10.6M. The volume of transactions with bonds of foreign issuers increased to ₴1.13B. The volume of transactions with Ukrainian
80 UKRAINE Country Report February 2024 www.intellinews.com