Ukraine and the United States signed an agreement in Kyiv on May 18 on U.S. loan guarantees for the issue of Ukrainian eurobonds worth $1 billion.
The agreement was signed by Ukrainian Finance Minister Natalie Jaresko, U.S. Ambassador to Ukraine Geoffrey Pyatt, and U.S. Agency for International Development (USAID) Europe Regional Mission Director Jed Barton.
Pyatt said that the deal became possible due to the first such guarantees for $1 billion granted a year ago being used successfully. He stressed that the allocated funds would be funneled into meeting short-term targets for expenditures and the protection of the public, as well as towards helping restore economic stability and conducting necessary economic reforms within the framework of the program agreed with the International Monetary Fund.
He said that the U.S. government in conjunction with the Congress would continue to work on allocating Ukraine up to $1 billion in additional loan guarantees at the end of 2015 if the reform program is implemented
Finance Natalie Jaresko in turn thanked the U.S. for its support, saying that the United States is the most consistent supporter of Ukraine in its words and deeds.
Jaresko stressed that the government remains committed to reforms.
As reported, U.S. loan guarantees for the second tranche of Ukrainian eurobonds worth $1 billion became effective on April 24, 2015.
“The loan guarantees shall ensure the Borrower’s repayment of 100 percent of principal and interest due under such borrowing,” USAID said in an earlier statement.
The Ukrainian Finance Ministry was expected to issue U.S.-backed eurobonds in the first half of May 2015.
Ukraine previously placed U.S.-government-guaranteed eurobonds worth $1 billion in the middle of May 2014. Their yield was only 28 basis points higher than that of U.S. T-bills and was a record low rate for Ukraine, being 1.844 percent per annum.
The said the bonds will mature on April 30, 2019. The issue was organized by JP Morgan and Morgan Stanley.
