Ukraine strikes deal to restructure $2.6bn of growth-linked debt

Ukraine secured support from key investors for restructuring $2.6 billion in growth-linked debts, essential for its war financing. The finance ministry announced a committee of GDP warrant holders agreed to swap their warrants for new bonds, enhancing debt insurance in negotiations.

The restructuring aims to maintain Ukraine’s debt sustainability amid risks from ongoing conflict or potential peace agreements. Ukraine is also awaiting an $8 billion IMF bailout and discussions on a reparations loan from Russia's frozen assets.

The new bonds will have a "loss reinstatement" provision, potentially doubling their value if further restructuring occurs. As a result, bond prices have rallied, while other debts have fallen. The country is pushing for completion by year-end to comply with its budget and reassure financial partners.