You're reading: Ukraine Eurobond issue in the cards

Good news on loan from IMF triggers rally on two previous issues

ked bond this week, but few other issuers are expected to brave what remains a very nervous emerging Eurobond market, analysts said on Monday.

'Sentiment remains extremely negative. Investors are looking to sell into any uptick in price,' said one emerging markets Eurobond trader.

Confirmation of a $2.2 million three-year International Monetary Fund loan package for Ukraine on Friday, coupled with the country's desperate need for short-term funds, make a Ukrainian bond issue this week more than likely, according to underwriters.

'The main obstacle to Ukraine's issue was the question mark over the IMF package. The package has now been confirmed, and with an August 12 deadline, Ukraine has not got time on its hands,' said one trader.

Bond underwriters expect Ukraine to launch a one-year $250 million bond linked to the national currency, the hyrvnya, via ING Barings and Nomura International.

Proceeds from the bond will part-repay a $450 million one-year zero-coupon Eurobond which matures on August 12.

Analysts last week had expressed fears that Ukraine would default on the bond if it failed to reach agreement with the IMF.

Confirmation of the IMF loan, though widely expected, triggered a six point rally on both Ukraine's benchmark one billion mark three-year Eurobond and 500 million Ecu two-year bond on Friday.