The restructuring of Eurobonds with the cancellation of 37% of the debt amount led to a deterioration in Ukraine’s credit ratings.
On August 13, rating agency Fitch Ratings downgraded Ukraine’s credit rating due to the start of restructuring of Eurobonds. This was reported on the agency’s website.
Thus, the rating of Ukraine was reduced from C to level RD (limited default), and Eurobonds 2026 for $750 million, for which Ukraine did not pay the coupon, to level D.
“The downgrade to RD follows the end of the 10-day grace period for coupon payments on the $750 million Eurobond, due on August 1. This is a default under Fitch’s criteria,” it said .
We remind you that on July 18, the Verkhovna Rada adopted a law that allows the government to temporarily suspend payments on state and state-guaranteed external debt until a restructuring agreement with creditors is completed.
On August 9, the Cabinet of Ministers officially announced the start of the procedure for obtaining consent to the restructuring of Eurobonds. According to the agency, such an operation is an exchange of the debt problem, because what is being discussed is the removal of part of the loan body and interest, as well as the extension of the maturity of the bonds.
On July 22, the Ministry of Finance announced that the committee of creditors agreed to write off 37% of the current debt in 13 series of sovereign Eurobonds and postpone the payment from 2024-2035 to 2029-2036.
After agreeing on all issues, Ukraine will issue two series of new bonds for a smaller amount (minus 8.7 billion) dollars.
The restructuring must be completed by August 27. Ukraine will pay additional funds to creditors who agree to the terms by August 23.
Ukraine’s public debt reached a new historical record
New Correspondent.net on Telegram and WhatsApp. Subscribe to our channels Athletistic and WhatsApp
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.