Ukraine has successfully completed the operation to restructure state and state-guaranteed debt for almost $20.5 billion.
This was reported by the Ministry of Finance and the London Stock Exchange.
The restructuring process included the exchange of 13 series of government Eurobonds and one series of state-guaranteed “Ukravtodor” Eurobonds worth approximately $20.5 billion (almost $24 billion including capitalized interest) for eight new series of Eurobonds with a face value of $15.2 billion.
Due to this agreement, the state and state-guaranteed debt of Ukraine was reduced by almost $9 billion. This means a nominal reduction in the value of the debt by 37% from the first day of the agreement and a reduction in the net present value of the debt by approximately 60% (at a discount rate of 14%). This is one of the largest debt write-offs in recent sovereign debt restructurings.
Debt payments are reduced by 93%, resulting in savings of $11.4 billion over the next three years. At the same time, the costs of servicing and repaying the debt will decrease by 77% by 2033, which will save a total of $22.8 billion.
- In August 2022, the owners of Eurobonds agreed to a two-year postponement of payments and their repayment terms. Ukraine has reached such an agreement regarding almost 75% of the total principal amount of securities in circulation. Most of Ukraineʼs creditors have suspended payment obligations until 2027.
- In October 2023, Reuters reported that Ukraine was discussing with foreign bondholders plans to restructure its $20 billion debt and raise new financing.
- In May, The Wall Street Journal wrote that foreign creditors of Ukraine want to resume payments on the national debt as early as 2025, but in June the creditors refused to restructure. Since then, active negotiations regarding restructuring have been ongoing.