On 30 July 2013, the President of Ukraine signed a law amending the Law of Ukraine “On Securities and Stock Exchange”, according to which international financial organisations, such as the EBRD and IFC, will now be able to issue bonds in Ukraine (IFO Bonds). Once the law comes into force, 60 days after its publication, international financial organisations will have an opportunity to lend to Ukrainian companies in local currency from funds raised from the placement of IFO Bonds. This, in turn, should result in the explosion of the Ukrainian lending market and reduction in local loan prices. 

Issuance of IFO Bonds must first be approved by Ukraine's Ministry of Finance. The approval has to be supported by the National Bank of Ukraine.

IFO Bonds, as well as all payments related to their placement, sale and redemption, must be denominated and made in UAH. All funds raised from the placement of IFO Bonds must be invested in Ukraine in accordance with international treaties. If there is no international treaty between Ukraine and an international financial organisation, usage of funds raised by the international financial organisation is subject to the approval of the Cabinet of Ministers of Ukraine.

General regulation of the issuance and circulation of IFO Bonds is performed by the National Securities and Stock Market Commission of Ukraine, provided, however, that requirements regarding the disclosure of information applicable to bond issuers in Ukraine is not applied to the international financial organisations.

Legislation:

The Law of Ukraine “On Amending of the Law of Ukraine “On Securities and Stock Exchange” Regarding the Issue of Bonds of International Financial Organisations” dated 19 June 2013.