significant amount of upcoming installments of Government Bonds in October 2009 could lead to production of new goszaymov with higher rates of return, according to the analytical review, prepared by analysts of ING Bank Ukraine (part of ING Group, Kiev).
In October, the government must pay grivnevyie government bonds amounting to 4 billion UAH. The only possible way for the government to fulfill commitments - is to issue new bonds. And in order to attract investors' rate of return is likely to be increased, - experts say.
As noted in the review, the reduction of the basic articles of revenue due to economic crisis and the amount of social payments in the presidential election led to the fact that the value of the state budget deficit this year could exceed 6% of GDP. Issue hryvnia government bonds is the only available source of deficit budget, - said in the review. This source is particularly important for the Government in the year since, apart from the simple placement of bonds among investors, the Government together with National Bank of Ukraine Government Bonds used to finance the budget by indirect monetary emission, stress analysts.
As stated in the document at the beginning of the rapid devaluation of the hryvnia has reduced the attractiveness of the Government Bonds in the eyes of foreign investors, and the outflow of deposits, tight monetary policy of the National Bank of Ukraine, lack of confidence in the hryvnia money market and unattractive conditions of the bond issue (16-20% per annum for 2-3 years) led them unattractive for Ukrainian banks.
However, in May 2009 the government issued short-term Government Bonds with a maturity of over 3-12 months. and increased the yield to 20-22% and higher, which, in combination with active refinancing of the National Bank increased the interest of investors to the market.
Since May 2009 grivnevyie Government Bonds (with a relatively low risk) were the most attractive short-term investment tool for Ukrainian investors, - analysts say.
As reported in the survey, in May-July, the government managed to attract banks to 3.4 billion UAH, while a large proportion of buyers were private banks.
At the same time, analysts point out that this involvement has not solved the problem of financing the budget deficit this year, but only postponed its decision for the immediate future, since most of the maturity of bonds due in the same year.
review authors predict that in the coming auctions of government will have a more active initial offering of its securities, as the privatization plans thwarted, and all Government Bonds, maturing in October, were released this year, and most were purchased non-state banks.
The government remains the only way to make all payments on the bonds in October - to refinance Government Bonds, maturing this month, through the issuance of new securities. Thus the rate of return should be increased due to low liquidity grivnevoy - summed up by experts.
As reported, the state budget for the current year provides for the sale of Government Bonds in the current year to UAH 26 billion (excluding the issuance of state bonds in the capitalization of the government schemes and other commercial banks). Since the beginning of the year the Finance Ministry has received from their accommodation UAH 13.27 billion, while the last auction on Oct. 6 the volume of accommodation has increased to 1.67 billion UAH 0.2 billion UAH from the prior week, while the rate for individual Government Bonds increased to 25% per annum.
External background moderately positive for the market of Russia, America closed moderate growth, Asia is trading in positive territory
Russia stock market against the backdrop of American grown-futures open gepom up
Again, before the opening of Russia's market share of a positive external background
At the start of the trading session favorites could be re-action Polyus Gold
Alexey Miller: Russia does not intend to reduce gas supplies to Ukraine
Latin America: Banco Santander accommodation not encouraged by Brazilian banks
Miller: Gazprom is not going to reduce the volume of gas supplies to Ukraine in 2010
Kommersant: Yulia Tymoshenko does not want to meet someone else's standards
Litvitsky: NBU advisable to reduce the discount rate
Experts: Ukraine on the eve of raising rates on Government Bonds
significant amount of upcoming installments of Government Bonds in October 2009 could lead to production of new goszaymov with higher rates of return, according to the analytical review, prepared by analysts of ING Bank Ukraine (part of ING Group, Kiev).
In October, the government must pay grivnevyie government bonds amounting to 4 billion UAH. The only possible way for the government to fulfill commitments - is to issue new bonds. And in order to attract investors' rate of return is likely to be increased, - experts say.
As noted in the review, the reduction of the basic articles of revenue due to economic crisis and the amount of social payments in the presidential election led to the fact that the value of the state budget deficit this year could exceed 6% of GDP. Issue hryvnia government bonds is the only available source of deficit budget, - said in the review. This source is particularly important for the Government in the year since, apart from the simple placement of bonds among investors, the Government together with National Bank of Ukraine Government Bonds used to finance the budget by indirect monetary emission, stress analysts.
As stated in the document at the beginning of the rapid devaluation of the hryvnia has reduced the attractiveness of the Government Bonds in the eyes of foreign investors, and the outflow of deposits, tight monetary policy of the National Bank of Ukraine, lack of confidence in the hryvnia money market and unattractive conditions of the bond issue (16-20% per annum for 2-3 years) led them unattractive for Ukrainian banks.
However, in May 2009 the government issued short-term Government Bonds with a maturity of over 3-12 months. and increased the yield to 20-22% and higher, which, in combination with active refinancing of the National Bank increased the interest of investors to the market.
Since May 2009 grivnevyie Government Bonds (with a relatively low risk) were the most attractive short-term investment tool for Ukrainian investors, - analysts say.
As reported in the survey, in May-July, the government managed to attract banks to 3.4 billion UAH, while a large proportion of buyers were private banks.
At the same time, analysts point out that this involvement has not solved the problem of financing the budget deficit this year, but only postponed its decision for the immediate future, since most of the maturity of bonds due in the same year.
review authors predict that in the coming auctions of government will have a more active initial offering of its securities, as the privatization plans thwarted, and all Government Bonds, maturing in October, were released this year, and most were purchased non-state banks.
The government remains the only way to make all payments on the bonds in October - to refinance Government Bonds, maturing this month, through the issuance of new securities. Thus the rate of return should be increased due to low liquidity grivnevoy - summed up by experts.
As reported, the state budget for the current year provides for the sale of Government Bonds in the current year to UAH 26 billion (excluding the issuance of state bonds in the capitalization of the government schemes and other commercial banks). Since the beginning of the year the Finance Ministry has received from their accommodation UAH 13.27 billion, while the last auction on Oct. 6 the volume of accommodation has increased to 1.67 billion UAH 0.2 billion UAH from the prior week, while the rate for individual Government Bonds increased to 25% per annum.
External background moderately positive for the market of Russia, America closed moderate growth, Asia is trading in positive territory
Russia stock market against the backdrop of American grown-futures open gepom up
Again, before the opening of Russia's market share of a positive external background
At the start of the trading session favorites could be re-action Polyus Gold
Alexey Miller: Russia does not intend to reduce gas supplies to Ukraine
Latin America: Banco Santander accommodation not encouraged by Brazilian banks
Miller: Gazprom is not going to reduce the volume of gas supplies to Ukraine in 2010
Kommersant: Yulia Tymoshenko does not want to meet someone else's standards
Litvitsky: NBU advisable to reduce the discount rate