Ukraine agreed to restructure external debt

“We are restoring debt sustainability. Today we have reached agreements in principle with the Committee of Eurobond Owners of Ukraine,” he wrote.

According to him, this is an important stage in the debt restructuring process, which will save $11.4 billion in debt servicing over the next three years and $22.75 billion until 2033.

Terms of restructuring

According to the press service of the Ministry of Finance , the bond restructuring agreement will provide that existing Eurobonds worth $23.4 billion in circulation will be exchanged for a package of new Eurobonds with a nominal reduction in the value of debt by 37% at the initial stage and a reduction in the net present value of debt by about 60%.

Once the restructuring is completed, the maturity of the Eurobonds will be extended: the first repayment in the amount of $1.172 billion will take place in 2029. Without the restructuring, $9.381 billion in principal (excluding capitalized interest) would have been due between 2024 and 2029.

According to the agreements reached, new Eurobonds will be issued: four series of Bonds A with maturities in 2029, 2034, 2035 and 2036 and four series of Bonds B with maturities in 2030, 2034, 2035 and 2036.

• Bond A coupons: 1.75% in 2024-2025, 4.5% in 2026-1H 2027, 6% in 2H 2027-2033 and 7.75% from 2034 onwards.
• Note B coupons: no coupons until the second half of 2027, then 3% from the second half of 2027 until 2033 and increasing to 7.75% from 2034 onwards.

As Finance Minister Serhiy Marchenko noted, “the completion of this restructuring agreement will create conditions for Ukraine’s early return to the international capital market when the security situation stabilizes in order to finance the rapid recovery and reconstruction of our country.”