According to the FT, dollar-denominated bonds maturing in September 2025 are now trading at 31 cents on the dollar, compared to 20 cents in early June. Other foreign currency bonds also recorded similar growth. However, Eurobond prices remain extremely low.
Such levels mean the market is convinced there is no alternative to future debt restructuring with a hard write-off. But the estimate of how much investors will be able to get increased.
“We believe that the restructuring may be more favorable for us because the country has a higher solvency than we thought before,” said an expert from the PGIM company, which owns part of the Ukrainian debt.
The largest owners of Eurobonds of Ukraine are the BlackRock, Pimco, and Fidelity funds. In the spring of 2023, the Ministry of Finance announced that it would hold negotiations with private creditors on debt restructuring. Negotiations with commercial lenders are expected to begin in early 2024.