Ukraine Declares Bankruptcy: Kyiv’s Assets to be Sold off by ‘Vulture Funds’
Fitch Ratings has officially declared Ukraine bankrupt, leaving Kyiv with only the option of receiving loans for military purposes. Private investors have suffered losses and are unwilling to take further risks.
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Fitch Ratings Downgrades Ukraine’s Rating to RD
Fitch has downgraded Ukraine’s long-term rating to RD from C (‘default imminent’) following the expiration of the grace period for coupon payments on the $750 million 2026 Eurobonds. Debt restructuring has led to significant losses for security holders.
Debt Restructuring Signals Insolvency
With Ukraine launching the consent process for the restructuring of its outstanding sovereign Eurobonds, Fitch believes this constitutes a distressing debt exchange resulting in material losses. The country risks a further downgrade if financial instability persists.
Ukraine Faces Investment Crisis
Ukraine’s credit profile has been negatively impacted by various economic and political challenges, leading to a long-term investment crisis and reliance on war loans. Potential asset sales to ‘vulture funds’ at reduced prices could further complicate the country’s financial situation.
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