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Concorde Capital research: Ukreximbank to offer only maturity extension for its 2015 notes

April 16, 2015 | Cbonds

State Export-Import Bank of Ukraine (Ukreximbank, EXIUMK) does not intend to offers any haircut or coupon decrease to the holders of its Eurobonds, the bank declared in its letter to bondholders on April 15. At the same time, it is going to negotiate an extension of maturity of up to ten years for its 2015 Eurobond (USD 750 mln maturing on April 27). In other news, Ukraine’s central bank ordered Ukreximbank to “take measures to change conditions of all its external obligations” in line with the IMF program, the regulator reported on its website on April 15.

Recall, Ukreximbank filed a consent solicitation on March 27 to ask for an extension of maturity for its 2015 bond for three months in order to buy some time to re-negotiate on new restructuring conditions. The bank scheduled two bondholder meetings to get the 3-month extension approved, for April 13 and 27, with the first one failing to convene due to lack of quorum.

Alexander Paraschiy: The 2015 notes of Ukreximbank gained almost 6% on Wednesday, which should mean that the bond holders appreciated the bank’s clarification regarding no intention to decrease the face value of its external obligations. This also adds some chance that holders will approve the offered 3-month extension of the notes at an April 27 meeting.

Our understanding of the upcoming negotiation process is that the bank is going to offer the same maturity extension for all its Eurobond issues, including the USD 600 mln notes maturing in 2018. At yesterday’s prices, the 2015 and 2018 notes of Ukreximbank yielded 19.6% to their maturity, providing that the maturity of both will be extended by five years. If the extension will be longer, the 2018 bond promises a higher yield, e.g. the YTMs will be 15.3% and 17.0% for 2015 and 2018 bonds, respectively, if both receive the ten year extension.

Company: Ukreximbank

Full company nameJoint Stock Company "The State Export-Import Bank of Ukraine"
Country of riskUkraine
Country of registrationUkraine
IndustryBanks

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