Ukrainian War Bonds: Invest to Support Democracy

Every single and tremendously painful day since Russia launched its unprovoked and barbaric military invasion of Ukraine, the civilised world has been witnessing the unimaginable bravery and dignity of the Ukrainian army as well as ordinary civilians trying their best to defend the bright and democratic future of Ukraine. Despite this courage, it goes without saying that Russian aggression has caused widespread damage to Ukraine, its economy and infrastructure.

To raise the required financing to support the army, Ukraine’s Ministry of Finance has decided to issue series of war bonds that can be purchased both by Ukrainian legal entities and individuals, and foreign investors who want to support Ukraine.

To promote the bonds, the National Bank of Ukraine, which also actively purchases Ukrainian war bonds, has introduced a simplified identification and verification mechanism exclusively for foreign individual buyers of war bonds and for Ukrainian nationals who permanently or temporarily reside abroad. This new mechanism enables remote identification and verification. The client only has to send the documents to the broker/bank through protected communication channels and pass verification by videoconference. This simplified procedure is available for transactions for a total of up to UAH 400,000 (EUR 12,273.70) per month.

The most recent auction, held on 12 April 2022, proved that interest in Ukrainian military bonds is on the rise. During this auction, the Ministry of Finance issued and placed bonds for a total of UAH 6.1 billion. The interest rate for the military bonds in UAH with a 15-month redemption period was set at 11%, and with the six-month redemption period at 10%.

The Ministry of Finance also issued the following war bonds, which should be available on the secondary market:

ISIN Currency Interest rate Volume Redemption period
UA4000225809 UAH 11% 2,656,480,869.75 Fifteen months
UA4000225791 UAH 10% 675,299,889.88 Six months
UA4000225668 UAH 11% 8,122,452,444.50 One year
UA4000221436 UAH 10% 20,748,677.63 Two months
UA4000225775 USD 3.7% 11,739,000 One year

Military bonds are traded through primary dealers that participate in auctions held by the Ministry of Finance in the interests of their clients. Among the primary dealers are two international and two local banks. The local banks include Оschadbank and PrivatBank. The international banks acting as primary dealers are Citibank and Raiffeisen Bank.

For direct purchases, a foreign investor should follow these steps:

  • choose and conclude an agreement with a Ukrainian broker with primary dealer status (the Broker);
  • open a securities account in one of the Ukrainian depository institutions;
  • place an order with the Broker.

If they do not have direct access to the Ukrainian depositary system or brokers, foreign investors can also consider using their foreign custodians as intermediaries in the process. Several foreign custodians have access to the Ukrainian depositary system through nominee accounts that foreign custodians hold with Ukrainian custodians. These foreign custodians are able to purchase and hold Ukrainian securities on behalf of their clients without the need for their clients to open Ukrainian accounts. Ukrainian war bonds can also be purchased via Clearstream.

In summary, war bonds are reliable investment instruments that offer an opportunity to invest in the sovereign risk of Ukraine, both in local and in hard currencies. In addition to reasonably high yields, war bonds also help Ukraine to defend itself and protect democratic principles in Europe and beyond.


Ihor Olekhov, partner, Head of Banking & Finance, CMS Cameron McKenna Nabarro Olswang

Bohdan Ilchenko, associate, CMS Cameron McKenna Nabarro Olswang

Khrystyna Korpan, associate, CMS Cameron McKenna Nabarro Olswang

Posted in #standwithUkraine