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Ukraine Wins Debt Relief as Russia Refuses to Join Agreement

  • Maturities to be pushed back by four years, coupons at 7.75%
  • Russia rejects request to accept new terms on $3 billion bond
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Ukraine agreed to a restructuring deal with creditors after five months of talks, giving President Petro Poroshenko some breathing room as he seeks to avert default and revive an economy decimated by a war with Russia-backed separatists.

Finance Minister Natalie Jaresko reached an accord with a Franklin Templeton-led creditor committee that includes a 20 percent writedown to the face value of about $18 billion of Eurobonds, the first of which matures in less than a month. In a joint statement announcing the initial agreement, the Finance Ministry and the creditor group said they are “pleased that a consensus on the best way forward for Ukraine has been found.” Bonds surged the most on record. Ukraine said it is offering the same terms to Russia, which holds a $3 billion bond due in December. Finance Minister Anton Siluanov reiterated that Russia won’t participate in the restructuring.