Until now the access of foreign investors to Ukrainian local sovereign bonds was possible but involved burdensome legal and administrative formalities. This is in marked contrast to the access available to foreign investors in Ukrainian sovereign Eurobonds, which circulate on international capital markets outside of Ukraine.
On 27 May 2019, Clearstream Banking S.A. opened a direct securities account at the National Bank of Ukraine, acting as a central securities depository for Ukrainian sovereign and municipal securities, including sovereign bonds of internal and external borrowings, GDP-linked warrants and municipal bonds. Clearstream’s customers worldwide will benefit from easier and simpler access to Ukrainian hryvnia-denominated sovereign bonds, and the Ukrainian economy will benefit from access to the larger investor base, new sources of financing the state budget at reduced cost, and free from currency risks. Settlements for the Ukrainian hryvnia-denominated sovereign bonds will be possible through the international central securities depository (ICSD), so reducing transaction and timing costs for foreign investors. Clearstream appointed JSC “Citibank” as its account operator of the direct securities account with the National Bank of Ukraine.