UKRAINE WEEK HIGHLIGHTS

Transcription

1 UKRAINE WEEK HIGHLIGHTS June 11, 2012: According to rating prepared by Business Insider company, Ukraine occupied 4 th place among the most default-risky countries. Experts counted the cost of insuring of USD 10,000 of sovereign duty for 1 year according to CDS indicator (credit default swap insurance against default of debt). Top-10 risky countries list looked as follows: 1. Greece (USD ); 2. Argentine (USD ); 3. Cyprus (USD ); 4. Ukraine (USD ); 5. Portugal (USD ); 6. Venezuela (USD ); 7. Egypt (USD ); 8. Ireland (USD ); 9. Hungary (USD ); 10. Croatia (USD ). In May 2012 international reserves of Ukraine decreased by USD 903 mio (-2.9%) to USD 30.8 bln. Since the beginning of the year total decrease amounted to USD bln or 3.3%. The decrease happened mainly as a result of planned repayments of IMF credits, as well as re-evaluation of nondollar assets due to EUR losing its value against USD by 6% last month. Experts expect that by the end of the year international reserves of Ukraine may decrease to USD 25.0 bln. June 12, 2012: In April 2012 negative balance of foreign trade of Ukraine amounted to USD bln (increased by 38.4% compared to April 2011), exports increased by 3.5% to USD bln and imports increased by 15.3% to USD bln, State Statistics Committee informed. In total within first four months of this year negative balance of foreign trade increased by 13.5% to USD bln, within this amount exports increased by 4.8% (to USD bln), whereas import increased by 6.2% to USD bln. Ukraine's GDP in I quarter of this year grew by 2.0% compared to January-March of 2011 (in constant prices of ), State Statistics Committee reported. Nominal GDP amounted to UAH bln (USD bln). June 13, 2012: National Bank of Ukraine (NBU) in May 2012 made short interventions to the interbank FX market, selling USD 45 mio more than bought, while in April and March the situation was reverse: the amount of FX purchased exceeded its sales by USD mio and USD million respectively. NBU also reported that the total volume of transactions on the interbank market in May rose by 8.3% to USD bln. June 14, 2012: In total in 5 months of this year sales of new cars in Ukraine increased by 9% compared to the same period of 2011, indicating the positive dynamics of development of the automotive market. Hyundai was the leader in sales by the end of May. Russian VAZ cars gave up the 2nd place on the market to ZAZ brand. Sales of KIA also increased, occupying the fourth place. June 15, 2012: The volume of investments to Ukraine by the international companies will increase by 25-35% in the future, the president of US-Ukraine Business Council Morgan Williams predicted. According to him, the most prospective for investments sectors of Ukrainian economy are agriculture, tourism and IT technologies. I M P O R T A N T N O T I C E : This is promotional. Please see the last page for important information and disclosures concerning eventual conflicts of interest and contacts June,

2 61 UKRAINE ECONOMIC OVERVIEW USD/UAH exchange rate Nominal GDP, mln $ GDP per capita, $ Economic Growth, % Industrial Production Index, % CPI, % PPI, % Current Account Balance, % of GDP Budget Balance, % of GDP Total Foreign Debt, mln $ State Foreign Debt, mln $ Reserves, mln $ Population, thnd people Unemployment rate, % Q Exp Source: National Statistics Committee of Ukraine, National Bank of Ukraine, Ministry of Finance of Ukraine Distribution of GDP according to economic sectors in Ukraine in 2011 Gross Domestic Product and State Debts in Ukraine, % 17% 7% Agriculture 1 20 Mining & quarrying 1 00 Manufacturing industry 14% 14% 5% 3% 15% 10% Electricity, gas & water 3% 4% 80 Construction 60 Trade 40 Transport and communication 20 Education 17.7% 14.8% 12.3% 34.6% 39.5% 36.0% 2% Healthcare & social aid 2005 Taxes Others GDP, nominal, bln UAH 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% % 2011 To tal State Debt, bln U AH State Debt to GDP ratio, % Government Incomes and Expenses in Ukraine, Dynamics of Export & Import of Ukraine, Q % % -5.0% % Q Consolidated Government Incomes, mln UAH 2005 Exp ort, mln USD June, Q Imp ort, mln USD Consolidated Government Expenses, mln UAH Budget deficit, % to GDP 2

3 BANKING SECTOR OVERVIEW Rating Agency STANDARD & POORS MOODY S FITCH RATINGS Last Update July October July 2011 Sovereign Rating of Ukraine B+ (stable) B2 (stable) B (positive) 2011Y, mln UAH 2011Y, mln USD Ratio to net assets, % Dynamics since the beginning of year, % Total assets % 11.1% Net assets % 11.9% Loans to corporate % 12.9% Loans to individuals % -3.9% Interbank loans % 42.5% Securities % 4.1% Fixed assets % -0.4% Deposits of corporate % 30.4% of them current,% 55.33% % -5.2% Deposits of individuals % 12.9% of them current, % 22.11% % -3.0% Share capital % 17.8% Retained earnings % 5.3% Loss provisions % 6.1% Net profit % -40.8% * - Compared to same period of previous year (losses of banking sector of Ukraine in Y were UAH mln) Official NBU USD/UAH exchange rate as of was used for calculations (7,9898) Capital % Assets ratio for different groups of Ukrainian banks as of % 13.4% 15.6% Top 10 banks Top banks Others ( banks) 10% 8% 6% 4% 2% % Net assets, mio UAH Own capital, mio UAH Capital vs assets, % Profitability structure of Ukrainian banks, in mio UAH Q Operating income Pre-provision income Net income June,

4 INTERNATIONAL FINANCIAL MARKETS KEY DRIVERS June 11, 2012: Standard & Poor's affirmed the sovereign ratings of the United States at "AA+" level, but left the outlook "negative" due to political and fiscal risks, the agency informed. Weaknesses of the USA include budgetary issues, the debt burden and "recent decline in the efficiency, stability and predictability in political management and political institutions. Negative factors can "accumulate to such extent that will force us to reduce the long-term rating by 2014," the rating agency warned. Among the strengths of the credit profile of USA S&P noted the "economic stability and reliable monetary policy", as well as the dollar's status as a major reserve currency in the world. "If Greece leaves the Euro Zone, it will threaten the very existence of the currency, and Moody's will review all ratings of the Euro Zone countries, the agency informed. At the current time according to Moody's Austria, France, Germany, Finland, Luxembourg and Netherlands are rated AAA. June 12, 2012: Wealth of the average American family in was USD 77.3 thnd, which is the minimum level since 1992, the U.S. Federal Reserve Survey of Consumer Finances reported. For comparison, in this figure exceeded USD 126,000. The average family income also fell from USD 49.6 thnd in to USD 45.8 thnd in. The Wall Street Journal wrote that the middle class was effected the most by the financial crisis, its income dropped by 12.1% in 3 years. The incomes of the richest families declined by only 1.4%, and of the poorest - by 7.7%. The indicators are adjusted for inflation. According to Ukrainian edition of Forbes, preparation and organization of EURO-2012 will give Poland a bonus of additional GDP growth of 2.1% during -2020, and in Ukraine the effect will be stronger, but shorter: due to preparatory activities from to 2012 the Ukrainian GDP will grow by an additional 2.8% (1% peak in 2011Y). June 13, 2012: Fitch Ratings downgraded the long-term credit ratings of 18 Spanish banks, including such major institutions as La Caixa, CECA, Banco de Sabadell, Bankia, Banco Popular Espanol. Decrease was explained by negative changes in the macroeconomic situation, the deterioration of quality of assets (mainly real estate) and the inability of banks to cope with the crisis without state aid. June 14, 2012: Following the decrease in rating of Spain by Fitch Ratings from A to BBB on 7 th of June, international rating agency Moody's also downgraded Spain's credit rating by 3 steps from A3 to Baa3. According to experts of the agency this downgrade is due to three key factors: 1. The intention to draw from the European Financial Stability Fund (EFSF) or the European stabilization mechanism (ESM) EUR 100 bln for recapitalization of domestic banks; 2. Limited abilities of the Spanish government on the financial markets; 3. The risks of sharp shrink in Spanish economy due to ongoing financial crisis and lack of government s reserve funds to support it. June 15, 2012: Moody's Investors Service downgraded the long-term ratings on debt obligations and deposits of 5 Netherlandish banks: Rabobank Nederland (Aa2, stable), ABN Amro Bank (A2, stable), Lease Plan (Baa2, stable), SNS (Baa2, stable), ING Bank N.V. (A2, negative). Public debt of Spain by the end of March increased to a record 72.1% of GDP from 63.6% a year earlier, the Central Bank of the country reported. The bank forecasts that during the current year level of debt of the country will continue to grow and by the end of year will amount to 79.8% of GDP June,

5 MONEY MARKETS World Money Market indicators Ukraine Money Market indicators Value as of Change in Value as of Change in Week, % 1 Month, % Week, % 1 Month, % Euribor 3m % % -3.6% KievPrime O/N % % -37.7% Euribor 6m % % -3.7% KievPrime 1m % % -46.9% Euribor 12m % % -3.6% KievPrime 3m % % -26.8% Libor 3m % % 0.4% KIEIBOR O/N % % % Libor 6m % % 0.8% KIEIBOR 1m % % 138.8% Libor 12m % % 0.8% KIEIBOR 3m % % 50.6% Source: Reuters Source: Reuters, NBU USD/UAH exchange rate, 3 months EUR/USD exchange rate, 3 months USD/RUB exchange rate, 3 months USD/TRY exchange rate, 3 months June,

6 CONTACTS Head of Treasury and FI FX operations Correspondent relations and TF Financial market research Igor Tykhonov Vladimir Priymak Oleksandr Turbovets Server Sadykov PJSC CREDITWEST BANK Treasury and FI Division Ukraine, Kiev, str. Kovpaka Reuters: WFCB DI S C L AIMER This research is prepared by analysts of Public Joint Stock Company WEST FINANCE AND CREDIT BANK (hereinafter - PJSC CREDITWEST BANK ) for information and promotional purposes only and should not be interpreted as the advice to make any transaction on financial markets. It is not investment advice or an offer for the purchase or sale of any financial instrument. The information has been obtained from/based upon public information sources that PJSC CREDITWEST BANK considers reliable as of the date hereof but PJSC CREDITWEST BANK does not represent that it is accurate and complete. This research reflects our current views which may be subject to change without notice. The information and analyses discussed herein may be unsuitable for investors depending on their specific investment objectives or financial position. Any investments and trends referred to herein may fluctuate and/or be affected by changes in exchange rates. Past performance is not indicative of future results. Opinions, estimates and recommendations expressed herein may not be relied on as the only ground to effect any transaction in the financial market. Investors should make their own investigations and investment decisions without relying on this report. PJSC CREDITWEST BANK has no responsibility for third parties operations including but not limited to any other action and/or failure to act of such third parties together with positive and/or negative results of such operations carried out on the grounds of opinions, estimates and recommendations expressed herein. In addition, PJSC CREDITWEST BANK may provide banking services for, or solicits such business from, any company referred to in this report. Neither PJSC CREDITWEST BANK nor any of its officers or employees accepts any liability for any direct or consequential loss arising from any use of this report or its contents. Copyright and database rights protection exists in this report and it may not be reproduced, distributed or published by any person for any purpose without written permission of PJSC CREDITWEST BANK June,