BNPQY - Deutsche Bank's Bet Pays Off Ukraine's Woes Escalate
- In December 2020, Deutsche Bank lent a $350 million bridge loan to Ukraine on the assumption the IMF would resume its own lending to the country within months.
- In February, the IMF postponed its credits to Ukraine indefinitely due to delayed reforms, leaving Deutsche Bank on the hook.
- Ukraine was forced to tap capital markets in April to raise money at much higher interest rates to repay the loan.
- Rampant borrowing spurred inflation, pushed interest rates higher and stifled economic growth; Ukraine's public debt soared to critical levels.
- Now, there is even a bigger problem looming on the horizon.
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Deutsche Bank's Bet Pays Off, Ukraine's Woes Escalate