Yesterday, the MoF refinanced more than a half of the debt repayments in local currency that were scheduled for this week, borrowing UAH10.2bn. There were a low number of bids, but with large demand, so most likely they were from local banks.
For seven-month bills, the Ministry returned the rate to 7.74%, which had seen a short-lived decrease last week when the five-month bills were sold at 7.1%. But yesterday, the Ministry moved the rate back to the level of six-month bills of two weeks ago. So, rate remained steady for this maturity, and collected UAH1.9bn of proceeds.
Rates for the one-year and 1.5-year bills remained steady also. However, to keep rates unchanged, the Ministry rejected bids with higher rates, but with low amounts.
For one-year bills, rates were kept at 9.2%, although there was bid at 12.5%. Total demand exceeded UAH3bn, and the rejected bid was just UAH100m. Therefore, this bid did not have an impact on the proceeds, which were UAH3bn.
For 1.5-year tenor with maturity in February 2022, the cut-off and weighted-average rates remained steady, too, at 10.25%. Just one bid amounting to UAH50m at 11%was rejected. These bids came in from five bidders, and provided the budget with UAH5.3bn of proceeds. This maturity was the only one yesterday that saw non-competitive demand.
Actually, most of bidders in the primary bonds market are local banks, as they have enough local-currency liquidity and access to cheaper loans from the NBU. It can be difficult to find a large amount of bills in the secondary market, as foreigners are not in hurry to sell bills from their portfolios.