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Ukraine’s Government Borrows over UAH 1,069 Billion through Auctions to Sell Domestic Government Debt Securities  since Martial Law Was Imposed

Ukraine’s Government Borrows over UAH 1,069 Billion through Auctions to Sell Domestic Government Debt Securities since Martial Law Was Imposed

According to the NBU Depository, in the first six months of 2024, the government of Ukraine raised an equivalent of over UAH 251 billion: UAH 177,468.9 million, USD 1,170.9 million, and EUR 670.8 million from offering domestic government debt securities through auctions and allocated UAH 103,703.2 million, USD 1,126.6 million, and EUR 841.2 million for redemption of domestic government debt securities.

In January–June 2024, the Ministry of Finance borrowed in the domestic debt market UAH 68,283.1 million more (in equivalent) than it spent to redeem domestic government debt securities, specifically UAH 8,553.6 million more in June (in equivalent). 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-June was 124% in all currencies at the current official exchange rate.

In total, from the onset of russia’s full-scale invasion of Ukraine through 30 June 2024, the government raised an equivalent of more than UAH 1,069 billion, in particular: UAH 731,644.6 million, USD 6.788,2 million, and EUR 2,383.9 million through primary auctions and allocated UAH 533,075.1 million, USD 7,262.3 million, and EUR 2,091.8 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. In June 2024, the maximum yield on domestic government debt securities offered at auctions was 16.80% per annum for hryvnia-denominated bonds and 4.66% per annum for U.S. dollar-denominated bonds. Euro-denominated war bonds were not issued in June.

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 July 2024.

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

Ukrainians and domestic businesses hold the second-largest portfolio of war bonds.  As of 1 July 2024, this portfolio comprised:   

  • UAH 52,967.8 million or 29.7% of the total value of purchased hryvnia-denominated war bonds (UAH 64,027.1 million or 33.1% as of 1 June)
  • USD 1,402.4 million or 58.4% of the total value of U.S. dollar-denominated war bonds (USD 1,464.7 million or 63.2% as of 1 June)
  • EUR 103.0 million or 21.7% of the total value of euro-denominated war bonds (EUR 94.9 million or 19.9% as of 1 May).   

Overall, the portfolio of war bonds owned by individuals and legal entities is equivalent to UAH 114.2 billion, according to 1 July 2024 data, two times up from UAH 56.5 billion on 1 July 2023.

As of 1 July, nonresidents held UAH 9,299.3 million, USD 24.8 million and EUR million in war bonds, more than 5 times the level at the beginning of the year.

In June 2024, the Ministry of Finance redeemed UAH 33,561.0 million  and USD 315.7 million of war bonds.

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


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Outstanding Military Domestic Government Debt Securities as of 01 July 2024
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