KYIV

Ukraine has bought back 10 percent of its dollar-denominated Eurobonds maturing in September 2022, bringing their outstanding volume down to $912 million.

The country has also brought the redemption of gross domestic product (GDP) warrants to 20 percent, the finance ministry said. Ukraine bought back 10 percent in 2020.

The Finance Ministry owns about 20 percent of the total nominal number of securities. The ministry said it did not intend to resell the GDP-linked securities at this time. After the Eurobonds were repurchased, they were cancelled.

Ukraine issued $3.6 billion of GDP warrants to sweeten its 2015 restructuring of $15 billion of debt, which forced investors to write off 20 percent of the original value of their holdings, Reuters reported. They have been trading at around 76 percent of face value.

Ukraine’s debt management strategy for 2021–2024 allows it to buy back government securities in order to smooth “the state debt service profile and reduce peak pressure on the state budget,” the ministry said.

Under that strategy, it “may buy back, at any time and from time to time, additional outstanding securities of Ukraine.”

These include but are “not limited to the GDP-Linked Securities or the 2022 Notes, in open-market purchases, privately negotiated transactions or otherwise depending on prevailing market conditions,” the finance ministry said, according to Reuters.

In July last year, Ukraine has priced an additional issue of Eurobonds worth $500 million to finance its state budget needs in 2021.

The additional issue increased the total amount of Eurobonds in circulation with an interest rate of 6.876 percent and maturing on May 21, 2029, the total outstanding amount of which amounted to $1.25 billion.

The additional issue took place with a yield of 6.30 percent and a bid price with an additional placement of 103.493 percent. The final bid book of $1.7 billion narrowed the spread by 32.5 basis points from the initial benchmark and by 57.5 basis points from the initial public offering of $1.25 billion in April.

BNP Paribas and Goldman Sachs International acted as joint lead managers.