Popov: Kyiv to succeed in repaying eurobonds worth $250 million on time

Kyiv will be able to attract a sufficient sum of money to repay a foreign loan of $250 million on time, Head of Kyiv City State Administration Oleksandr Popov has said.

"We will have to repay a $250 million loan in November, but we are ready to do so. All the preparatory work has been done. We will not raise extra funds, we are doing this to service the existing external debt," Popov said in an interview with Interfax-Ukraine.

"We will issue government domestic loan bonds for refinancing, and to have the chance to continue working under the previous conditions," he said.

Popov expressed confidence that Kyiv would be able by November to find the required sum to repay the foreign loan, despite the fact that it succeeded in attracting only about Hr 750 million from the placement of government domestic loan bonds over 1.5 months.

"Of course, we will collect [the sum]. We have agreements regarding necessary assistance with the Finance Ministry, the National Bank, and the commercial banks. Thus, there is no reason for concern today. These could be both domestic and foreign borrowings," the official stated.

As reported, Kyiv City Council on May 24 made decision to raise a domestic loan of Hr 3.5 billion for three years with an annual interest rate of 15.25%. The placement of securities was scheduled for June 25 to December 31, 2012.

Part of the funds will be used to repay the foreign debt, particularly five-year eurobonds worth $250 million issued in 2007, and the remaining funds to implement projects of the social and economic development.