ZN.UA
The Ministry of Finance of Ukraine has temporarily placed free funds in the amount of $200 million provided by KfW Development Bank for NJSC Naftogaz of Ukraine in a deposit account in state-owned Ukrgazbank until December 1, 2015.
According to a posting on the website of the Finance Ministry, this decision has been agreed with the German government and the KfW, and taken in accordance with the Ukrainian legislation based on results of the competition held among the banks.
The report notes that the German government has suggested to use a part of funds under the KfW loan to ensure additional foreign currency liquidity to the banking system, which will help Naftogaz attract the necessary loan resources from the Ukrainian banks to cover temporary cash deficit as a result of gas purchases. This will also enable the company to finance the program of gas injection into underground storage facilities in the last weeks before the start of the heating season.
Read alsoNaftogaz Ukrainy to lose its monopoly status on gas market in Ukraine from Oct 1It is also reported that the interest rate for the use of budget funds by the bank is set at 5% per annum. In addition, the bank is committed to retain domestic treasury bonds in the amount of not less than 120% of the deposit during the whole period of its placement, pursuant to the deposit agreement.
As UNIAN reported earlier, international financial institutions, led by the World Bank, are preparing together a financing package worth $1 billion to help Ukraine and its energy giant Naftogaz to strike a gas purchase deal with Russian Gazprom.
The funding, which would come through a mix of loans and guarantees, was said to remove one of the main obstacles to another gas-supply deal between Kyiv and Moscow.