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National Bank includes govt bond issues of Dec 2024, May 2025 in list of benchmark govt bonds
KYIV. Jan 31 (Interfax-Ukraine) – The National Bank of Ukraine (NBU) agreed with the proposal of the Ministry of Finance and included issues of government domestic loan bonds (maturing on December 4, 2024 (ISIN UA4000227094) and May 21, 2025 (ISIN UA4000227102) in the benchmark government bonds.
According to NBU Board decision No. 40 dated January 30, published on its website, banks will be able to form up to half of their reserve requirements from February 11.
As reported, from January 11, the NBU raised the required reserve requirements for current accounts (demand deposits) in hryvnia and foreign currency by 5 percentage points, to 5% and 15%, respectively, allowing to cover up to 50% of the total required reserves at the expense of benchmark government bonds. As a result, required reserves increased by UAH 74.3 billion to UAH 144.1 billion, which means a limit on the purchase of benchmark government bonds against reserves of UAH 72 billion for the period until February 10.
During this time, the National Bank has established only one issue of benchmark government bonds – ISIN UA4000227045 with maturity in August 2024. At auctions on January 3 and January 10, the Ministry of Finance placed these securities for about UAH 21.6 billion at 19.25% per annum, while demand exceeded UAH 50 billion.
On January 26, the National Bank announced another similar increase in the required reserve ratios by 5 pp from February 11. As the NBU said on its website on Tuesday, this should increase reserves by about UAH 73 billion, that is, bring the potential volume of required reserves formation at the expense of benchmark government bonds to about UAH 108.5 billion.
At the recent auctions held on January 24, the Ministry of Finance placed the above bonds maturing in December 2024 and May 2025, raising the rates on them to 19.6% and 19.75% per annum, respectively. Banks, hoping to be included by the National Bank in the benchmark government bonds, purchased these securities for UAH 6.3 billion and UAH 4.9 billion, respectively.
