Yatsenyuk: Ukraine to Impose Moratorium on Russian Debt if Moscow Says no to Restructuring

Ukraine will declare a moratorium on the payment of a "Russian debt" if Moscow does not accept proposed terms of debt restructuring, Ukrainian Prime Minister Arseniy Yatsenyuk said at a press conference on Friday.

As UNIAN reported earlier, the Ukrainian government regrets that the holders of bonds maturing in December 2015 refused to support the restructuring deal, but the Cebinet is ready to find a solution regarding holders of these bonds.

Russia bought $3 billion worth of eurobonds from Ukraine in December 2013, with Kyiv due to pay the debt off by December 2015. The eurobonds were placed on the Irish Stock Exchange and facilitated by VTB, Russia’s second largest bank. A total of $15 billion was promised by Russia to help buffer Ukraine’s dire economic situation on the condition a new government was formed. But Russia had not offered new funds to Ukraine after the Maidan turmoil broke out in the country.

The Ukrainian government called on Russia to participate in the restructuring deal, but the latter is said to have refused.

Only one series of eligible debt instruments did not participate in the exchange offer, the Finance Minister reported.

The terms of the new sovereign notes issued today include contractual provisions which prevent Ukraine from paying such eurobond in accordance with its terms or settling with the holders of such eurobond on terms more favorable than those received by participating bondholders in the just-completed exchange offer.

"Ukraine regrets that that holders of such eurobond have decided not to support Ukraine’s essential debt operation, but within the contractual constraints in which it must operate the government of Ukraine remains open to finding a solution with the holders of the December 2015 eurobond," the statement reads.