IMF hopes for Ukraine’s restructuring of $3 bln debt to Russia

WASHINGTON, Apr 4 (PRIME) -- The executive board of the International Monetary Fund (IMF) believes that Ukraine may restructure its U.S. $3 billion Eurobond held by Moscow, Ron van Rooden, head of the fund’s mission to Ukraine, said in a conference call on Tuesday.

On Monday, the IMF allocated the next $1 billion tranche of its financial assistance to Ukraine.

“Directors based (the decision to grant the tranche) on the idea that the government of Ukraine will be able to reach an agreement on restructuring of the debt to Russia. We are still calling upon them (the Ukrainian authorities) to take honest efforts on this issue,” he said.

Russia bought Ukraine’s 2-year Eurobonds in December 2013 and later rejected restructuring conditions offered by the country to its commercial creditors. Kiev insisted that the terms of debt repayment to Russia should be the same as for private creditors. The International Monetary Fund recognized the debt as sovereign.

In February 2016, Russia filed a lawsuit with the High Court of Justice in London demanding that Ukraine pay the main debt of $3 billion, as well as $75 million of the last coupon income and additional interests accrued since December 20, 2015, the maturity date of the securities.

The London court decided on March 29, 2017 to confirm Russia’s request to expedite the hearing and will not hear the case fully with analysis of documents and verbal arguments. Russia’s Finance Ministry said before that the request was based on the fact that Ukraine has no real chances to challenge a demand to redeem the debt.

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