According to the NBU Depository, in January Ukraine raised UAH 13,361.3 million, USD 254.7 million, and EUR 235.5 million from offering domestic government debt securities through auctions and allocated USD 80.0 million, and EUR 251.5 million for redemption of domestic government debt securities.
In January, the Ministry of Finance borrowed in the domestic debt market UAH 19,321.7 million more (in equivalent) than it spent to redeem domestic government debt securities. The rollover of investments in domestic government debt securities (the ratio of the face value of securities sold at auctions to those redeemed in accordance with the terms of their issue) in January was 203% at par in all currencies at the current official exchange rate.
In total, from the onset of russia’s full-scale invasion of Ukraine through 31 January 2024, the government raised UAH 567,537.0 million, USD 5,872.0 million, and EUR 1,948.6 million through primary auctions and allocated UAH 429,371.9 million, USD 6,215.7 million, and EUR 1,502.2 million to redeem domestic government debt securities.
The domestic debt market was revived thanks to the joint efforts of the government and the National Bank of Ukraine.
In particular, the NBU allowed the banks to use benchmark domestic government debt securities from the NBU’s list so that the banks can meet up to 50% of their total required reserve ratios, and gradually expanded this list. Furthermore, the NBU enabled the repatriation by nonresidents of interest payments received after 1 April 2023 on domestic government debt securities, provided they comply with a requirement that the investor shall have owned such domestic government debt securities for a certain minimum period that precedes the receipt of said interest.
For its part, the government is offering market-based interest rates on domestic government debt securities. The maximum yield on the war bonds issued in January 2024 was 18.60% per annum for hryvnia-denominated bonds, 4.66% per annum for U.S. dollar-denominated bonds, and 3.25% per annum for euro-denominated ones.
The domestic debt market’s active operation is important for ensuring macrofinancial resilience. On the one hand, macrofinancial resilience is a safeguard against monetary financing of the budget deficit. On the other hand, it is an important instrument for improving the maturity structure of funds in the banking system and mitigating risks to the FX market and price stability.
Everyone can purchase war bonds now and strengthen the financial resilience of Ukraine.
Below are the NBU Depository’s detailed statistics on war bonds offered through auctions, as of 1 February 2024.
As before, primary dealers – the banks – hold the largest portfolio of war bonds.
Ukrainians and domestic businesses hold the second-largest portfolio of war bonds. According to 1 February 2024 data, this portfolio comprises:
- UAH 45,684.1 million or 28.6% of the total value of purchased hryvnia-denominated war bonds (UAH 42,588.8 million or 28.4% as of 1 January)
- USD 1,119.2 million or 53.8% of the total value of U.S. dollar-denominated war bonds (USD 1,011.9 million or 55.3% as of 1 January)
- EUR 108.4 million or 17.1% of the total value of euro-denominated war bonds (EUR 102.8 million or 17.4% as of 1 January).
Overall, the portfolio of war bonds owned by individuals and legal persons is equivalent to UAH 92.1 billion, according to 1 February 2024 data, up from UAH 37.6 billion on 1 February 2023, an increase of nearly 2.5 times.
Nonresidents hold UAH 15,471.2 million, USD 24.2 million, and EUR 0.1 million in war bonds, having almost doubled in a year (since 1 February 2023), data available on 1 February 2024 show.
The Ministry of Finance did not redeem war bonds in January 2024.
Find out more about the military domestic government debt securities here. The table presents data at amortized face value.
On 22 March 2022, the NBU began to publish weekly statistics of the NBU Depository related to war bond transactions. At the beginning of 2023, the NBU switched to the monthly publication of relevant releases as of the first day of the month. Previous data are available by the tag war bonds.