Ukrainian government debt holders should be ready to have a little trimmed off the top.
Sergio Trigo Paz, head of emerging markets fixed income at BlackRock, said Thursday that the creditors negotiating a deal with Ukraine shouldn’t rule out takinga hhit to their holdings. BlackRock is currently one of the largest holders of Ukrainian government debt, with billions of dollars worth of bonds in indexed and actively managed funds.
By contrast, Franklin Templeton Investments , the No. 1 creditor with $8.9 billion in debt, has joined other investors who insist a haircut is not a possibility.
The IMF gave Ukraine a $17.5 billion bailout package in March, but said that a deal with creditors should be completed by mid-June. Trigo Paz described the Ukraine situation as “very fragile,” and called for a total restructure of the country’s debt. The creditor committee includes T. Rowe Price, TCW Group, BTG Pactual Europe, and Franklin Templeton Investments.
Ukraine though is expressing worry over the negotiations. Writes the Wall Street Journal:
Ukraine, advised by Lazard Ltd. and White & Case LLP, last week voiced concerns “about the approach taken by the creditors’ committee” as well as “their lack of willingness to engage in negotiations.”
Photo: Alec via Flickr.