Ukraine averts default with $120mn bond payment

BNE News ^ | July 24, 2015 | Sergei Kuznetsov

[Navy Patriot]

Ukraine made a $120mn interest payment on its Eurobonds on July 24, once again staving off a much speculated default scenario on billions in external debt that the country owes private creditors.

With the International Monetary Fund (IMF) pressuring Ukraine to quickly agree the restructuring of $15.3bn in privately held debt with a group of main creditors, the latest payment creates valuable breathing space for further talks before the "big one", a $500mn payment on bonds due September 23.

Artem Shevalev, Ukraine's Deputy Finance Minister, first informed Russia's TASS news agency that Kyiv paid the $120mn. Ukraine's UNIAN news agency also cited an unnamed Kyiv-based government source who confirmed the information.

Up to the last moment, analysts did not conceal concerns that Ukraine, battered by deep economic crisis and military conflict in its eastern Donbas industrial region, may use a recently passed law on a moratorium on debt reimbursement and refuse to pay.

[Navy Patriot]

Passed in early June, the adoption of the new law allowing the government to declare a moratorium on foreign debt repayments to private investors ramped up pressure on bondholders to agree to a restructuring demanded by Kyiv or wind up empty-handed after a default.

Guess who the Private foreign investors are...

[mac_truck]

Templeton Funds are a huge private investor in Ukraine.

[Navy Patriot]

Affirmative, and Ukraine’s new law allows them to selectively renege on debts. Oh so democratic.