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Russia on the verge of historic default as payments expire

Russian Finance Minister Anton Siranov (seen here with Russian President Vladimir Putin in 2019) told the Russian newspaper Vedmosti that Moscow will continue to handle the ruble’s foreign debt, but foreign eurobond holders To receive payments reportedly told a Russian bank that it is necessary to open a ruble and hard currency account.

Mikhail Svetlov | Getty Images News | Getty Images

Russia could fall into its first major foreign debt default for more than a century after the grace period of two international bond payments on Sunday night.

A total of $ 100 million in interest payments will be paid on May 27, with a grace period that expires on Sunday night. Some media outlets report that bondholders have not yet received payments after international sanctions have blocked attempts to pay in Russian ruble currency.

The sanctions imposed by Western nations in response to Russia’s invasion of Ukraine have effectively expelled the country from the global financial system, along with countermeasures from Moscow, but so far the Kremlin has held bonds many times. I was able to find a way to get paid to the person.

Attempts to circumvent sanctions were further hit in late May. U.S. Treasury has allowed major exemptions to expire.. Previously, this exemption allowed the Central Bank of Russia to process payments to bondholders in dollars through US and international banks on a case-by-case basis.

Russia’s Treasury Minister Anton Sir Anov suggested earlier this month: Russia may have found another payment method.. Moscow has sent $ 100 million in rubles to a domestic clearing house, but the two bonds in question are not subject to the ruble clause, which allows payments in domestic currency to be converted abroad.

Earlier on Monday, Reuters quoted two sources and reported that some Taiwanese holders of Russian Eurobonds had not received interest payments to be paid on May 27. ..

Siluanov told Russian state news agency RIA Novosti that obstruction of payments usually does not constitute a true default resulting from the reluctance or helplessness of payments, calling the situation a “teaser”. I am.

According to the agreement, some bonds issued after 2014 are allowed to be paid in rubles or other alternative currencies, but an additional $ 2 billion is expected to be paid by the end of the year.

It’s a signal that the payment is actually pending due to international sanctions, but it can take some time to see the defaults.

Russia on the verge of historic default as payments expire

Source link Russia on the verge of historic default as payments expire

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