Statement of the Ministry of Finance on the adoption by the city of Kyiv Rada of a resolution suspanding payments on external borrowings

10/8/15

The Ministry of Finance of Ukraine takes note of today’s adoption by the City of Kyiv Rada of a resolution suspending payments on two external borrowings of the City financed by Eurobonds. Suspension becomes effective on 6 November. This suspension is necessary to ensure the City has sufficient time to negotiate with its creditors and implement a restructuring of its external borrowings sufficient to stabilize the City of Kyiv’s financial position and create a more sustainable medium term debt profile for the City. The Ministry of Finance believes such a restructuring will be in the interest of the City and its citizens, as well as in the long term interest of the City’s creditors.

The Ministry of Finance notes that the external indebtedness of the City which is subject to the announced suspension of payments falls within the perimeter of debt obligations that the Cabinet of Ministers of Ukraine has identified in April 2015 as being subject to restructuring in order to meet the three financing targets under Ukraine’s Extended Fund Facility. The Ministry of Finance is prepared to support the efforts of the City of Kyiv to help ensure the needed restructuring is completed.

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