Business news from Ukraine

NET SALE OF CURRENCY BY NATIONAL BANK OF UKRAINE LAST WEEK TOTALS $157 MLN

The National Bank of Ukraine (NBU) in the period from September 30 through October 4, 2019 first since the start of August entered the market to support the hryvnia, selling $200 million – almost the same amount as for the entire period since the beginning of 2019.
According to a posting on the website of the central bank, all these interventions were made at the single exchange rate (using the matching tool).
At the same time, the National Bank last week managed to acquire $42.5 million, as a result of which the net sale of foreign currency amounted to $157.5 million.
In general, since the beginning of 2019, the NBU has bought $4.199 billion at the interbank currency market, sold $448.2 million, in particular, it bought $930 million in September, $316 million in August, $1.271 billion in July, and $322 million in June, and sold only $ 17 million early August.

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NATIONAL BANK REGISTERS DOMESTIC LIME MONEY PAYMENT SYSTEM

The National Bank of Ukraine (NBU) has agreed the rules and registered the domestic payment system Lime Money, the NBU said in a statement on its website.
According to the report, Lime Money’s payment company is Smart Finexpert LLC (Mykolaiv).
Lime Money payment system became the twelfth national payment system in the Ukrainian market, which is created by non-banking institutions.

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NATIONAL BANK IMPROVES FORECAST FOR RESERVES, DEFICIT OF BALANCE OF PAYMENT

The National Bank of Ukraine (NBU) has improved the forecast for forex reserves as of late 2019 from $20.6 billion to $21.2 billion, from $21.4 billion to $21.9 billion as of late 2020 and from $21.4 billion to $21.8 billion as of late 2021. According to data released by the central bank on Thursday, the assessment of the deficit in the consolidated balance of payments for 2019 has also been improved from $1.1 billion to $0.3 billion, while for 2020-2021 it is confirmed at the level of $0.1 billion and $0.7 billion respectively.
At the same time, the NBU worsened the forecast of the current account deficit: for the current year – from $4.5 billion to $4.9 billion, for the next year – from $5.6 billion to $5.8 billion, and for 2021 – from $6.2 billion to $6.7 billion
In relation to GDP, the assessment of the current account deficit for 2019 is worsened from 3.1% of GDP to 3.3% of GDP, for 2020 it is confirmed at the level of 3.6% of GDP, and for 2021 it is worsened from 3.9% of GDP to 4% Of GDP.
As reported, at the end of 2018, Ukraine had forex reserves of $20.8 billion, a surplus of the consolidated balance of payments of $2.9 billion and a current account deficit of $4.5 billion or 3.4% of GDP.

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NATIONAL BANK OF UKRAINE TO SEND UAH 65 BLN TO NATIONAL BUDGET

The National Bank of Ukraine (NBU) will send part of its profit for 2018 in the amount of UAH 64.878 billion to the national budget, Head of the NBU Council Bohdan Danylyshyn wrote on his Facebook page, referring to the decision of the NBU Council, on Tuesday.
“The Council decided to approve the distribution of profits of the National Bank of Ukraine for 2018 in the amount of UAH 64.878 billion in the following areas: the formation of total reserves of net worth of the National Bank of Ukraine – UAH 3.566 billion; obligations of the National Bank of Ukraine to the national budget of Ukraine for 2018 year – UAH 64.878 billion,” he wrote.
As reported on the website of the NBU, the main components of the profit of the central bank are the interest profit, as well as the results of operations with financial assets and liabilities in foreign currency and financial tools.
Net interest income after the release of reserves for 2018 is UAH 34.9 billion (in 2017 – UAH 45.2 billion). In 2018, the result of currency revaluation for the first time since 2013 became negative due to the strengthening of the hryvnia exchange rate to foreign currencies and amounts to UAH 2.2 billion. A positive result from the revaluation of debt securities at fair value is UAH 6.7 billion (in 2017 – UAH 2.7 billion). Administrative expenses of the NBU and costs associated with the manufacture of banknotes, coins and other products amount to UAH 3.78 billion (in 2017 – UAH 3.59 billion). Also in 2018, funds secured for legal obligations, including lawsuits, in the amount of UAH 2.1 billion were released.
The schedule for transferring part of the NBU profit for 2018 to the national budget will be agreed with the Finance Ministry of Ukraine, the NBU said.

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NATIONAL BANK STARTS PUBLISHING DATA ABOUT INDIVIDUALS’ DEPOSITS IN TERMS OF AMOUNTS, CURRENCIES

The National Bank of Ukraine (NBU) has started publishing data about individuals’ deposits in banks in terms of their amounts and the currency of the deposits, as well as the amount of possible refunds by the Deposit Guarantee Fund.
“The information is first published by banks on their websites until the end of the month following the reporting month, and then in aggregated format on the National Bank’s website in the Statistics – Banking System Indicators section, the NBU said on its website.

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NATIONAL BANK COUNTS ON FURTHER COOPERATION WITH IMF

The National Bank of Ukraine (NBU) counts on continuation of cooperation of Ukraine with the International Monetary Fund (IMF) after the expiration of the currency Stand-By Arrangement (SBA), according to an inflation report for January 2019 posted on the website of the central bank.
The document, in particular, has the key assumptions for the macroeconomic forecast of the NBU for 2019-2021, including payments to the public sector from donors in 2019-2021 ($6.5 billion from the IMF, $1.6 billion each from the EU and the World Bank), along with the placement of government external loan bonds for $8.5 billion, will allow refinancing most of the payments on external obligations.
As reported, the IMF Executive Board, following a meeting on December 19, 2018, approved a new program of cooperation with Ukraine under the stand-by arrangement. The amount of the 14-month program is equivalent to SDR 2.8 billion, or about $3.9 billion. Some SDR 1 billion (about $1.4 billion) was provided immediately, while the remaining funds will be provided based on the results of the program reviews in May and September 2019. The NBU thus plans to raise some $4 billion from the IMF in 2020-2021.
In addition, at the end of January 2019, the NBU said that it had laid out macroeconomic forecasts for the country to place eurobonds worth $2 billion in 2019. Thus, the National Bank expects an increase in sovereign eurobonds in subsequent years to more than $3 billion.
As reported, Ukraine in October 2018 placed two tranches of eurobonds: $750 million five-year bonds and $1.25 billion 10-year bonds.
The yield on the five-year bonds was 9% per annum, and for the 10-year bonds it is 9.75%.
BNP Paribas, Citi, Goldman Sachs and J.P. Morgan acted as organizers of the issue.

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