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NBU Depository: Since Full-Scale Invasion, Ukraine’s Government Borrows an Equivalent of UAH 306 Billion through Auctions to Sell Domestic Government Debt Securities

NBU Depository: Since Full-Scale Invasion, Ukraine’s Government Borrows an Equivalent of UAH 306 Billion through Auctions to Sell Domestic Government Debt Securities

According to the NBU Depository, since russia launched its full-scale invasion of Ukraine through 31 January 2023, the government raised UAH 203,741.4 million, USD 1,969.2 million, and EUR 1,006.7 million from placement of domestic government debt securities through auctions and allocated UAH 222,395.9 million, USD 2,793.3 million, and EUR 662.6 million for redemption of domestic government debt securities.

In January 2023, the Ministry of Finance borrowed in the domestic debt market UAH 44,914.9 million more (in equivalent) than it spent to redeem domestic debt bonds.

The NBU jointly with the Government of Ukraine put efforts to revive the hryvnia segment of the domestic debt market.

Since 11 January 2023, the NBU has allowed the banks to use benchmark domestic government debt securities, ISIN UA4000227045, to meet up to 50% of their total required reserve ratios.  Besides, since 11 February, the banks will be able to meet the required reserve ratio using two more issues of benchmark domestic government debt securities, ISIN UA4000227094 and UA4000227102.

On its part, the Ministry of Finance has raised interest rates on hryvnia-denominated domestic government debt securities. In particular, the maximum rate on hryvnia war bonds went up from 16% p.a. in October 2022 to 19.7% p.a. in January 2023.

Over the period under martial law, the Ministry of Finance also increased the interest rates on a number of U.S. dollar domestic government debt securities, with the maximum yield being at 4.5%  p.a., and on euro war bonds, with the maximum yield reaching 3% p.a.

Today, everyone can purchase war bonds and strengthen the financial defense of Ukraine.

Find below detailed statistics by NBU Depository on war bonds offered through auctions, as of 1 February 2023.

Primary dealers – banks – hold the largest portfolio of war bonds.

The second-large portfolio of war bonds is held by Ukrainians and domestic businesses. It comprises  

  • UAH 21,422.0 million or 21.3% of the total value of purchased hryvnia-denominated war bonds (UAH 20,248.8 million or 20.2% as of 1 January)
  • USD 344.1 million or 32.0% of the total value of U.S. dollar-denominated war bonds (USD 300.5 million or 29.1% as of 1 January)
  • EUR 92.4 million or 17.4% of the total value of euro-denominated war bonds (EUR 86.8 million or 17.3% as of 1 January).

Nonresidents hold over UAH 8,217.1 million and USD 9 million in war bonds.    

On 11 January 2023, the Ministry of Finance of Ukraine paid UAH 6,799.7 million to redeem war bonds denominated in domestic currency.

Find out more about the military domestic government debt securities here.  The table presents data at the amortized face value.

For reference

On 22 March 2022, the NBU began to publish weekly statistics of the NBU Depository related to war bond transactions. From the beginning of 2023, the NBU switched to monthly publication of relevant releases as of the first day of the month. Previous data are available by tag war bonds

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