15 Jun 2023 18:22

No need for further changes to terms for repatriating govt bond interest - NBU

MOSCOW. June 15 (Interfax) - The National Bank of Ukraine's decision to make the repatriation of interest on government bonds by non-residents conditional on holding them for at least three months has justified itself: investments by non-residents in the primary market has tripled, and there is no need for other changes, said NBU Deputy Governor Yury Gelety said.

"If before this improvement, non-residents bought UAH 2 billion of government bonds on the primary market during April, then after our decision, this has risen to about UAH 6 billion. That is, the primary market has become a more active platform for non-residents," Ukrainian media quoted him as saying at a briefing on Thursday.

"Are we planning any more tweaks? There are no grounds for this right now. We see that the participation of non-residents has improved, in general, the market is functioning satisfactorily," Gelety said.

He said the National Bank saw potential for further investment by non-residents in government bonds, as they had proceeds from the redemption of bonds and other funds.

"We're monitoring the situation. Currently, there are no grounds for additional concern," he said.

Gelety again said need to introduce such "tuning" for repatriation in April was due to the fact that a "carousel" had started on the market: after the payment of government bonds, non-residents were looking for an instrument with the nearest coupon, which could have continued throughout the current year.

According to NBU data, non-residents have invested UAH 50 billion in government bonds. This grew by UAH 1.5 billion as the result of the primary auctions on June 14, and by UAH 2.7 billion since the beginning of the month, although at the beginning of April they reached UAH 51.6 billion, a month earlier - UAH 55.5 billion, and at the end of January - UAH 62.5 billion.