• Home
  • Breaking News
  • Privacy Policy
  • Email Whitelisting
No Result
View All Result
Money Profit News
No Result
View All Result
Home Breaking News

Taiwanese holders of Russian bonds say they haven’t received payments: Sources

by
June 27, 2022
in Breaking News
0
0
SHARES
0
VIEWS
Share on FacebookShare on Twitter

Related Posts

The Average 401(k) Balance by Age

Fed sees interest rate hikes continuing until inflation eases substantially, minutes show

FOMC Minutes "Participants anticipated that this slowdown in housing activity would continue"

Frenzied trading in meme stocks is a warning sign for the broader market

The headquarters of Russia’s central bank in Moscow on Feb. 28, 2022. Sweeping sanctions imposed by Western capitals on Russia in the wake of its invasion of Ukraine on Feb. 24 as well as countermeasures by Moscow have all but severed the country from the global financial ecosystem.
Bloomberg | Bloomberg | Getty Images

Some Taiwanese holders of Russian eurobonds have not received interest due on May 27 after a grace period expired on Sunday evening, two sources said, potentially setting Moscow on track for its first major external sovereign default in over a century.

Russia was due to make $100 million in coupon payments on two eurobonds on May 27 — $29 million on a euro-denominated 2036 bond and $71 million on a dollar-denominated 2026 bond.

Sweeping sanctions imposed by Western capitals on Russia in the wake of its invasion of Ukraine on Feb. 24 as well as countermeasures by Moscow have all but severed the country from the global financial ecosystem. Russia calls its actions in Ukraine a “special operation.”

Despite the plethora of curbs, Russia had managed to make payments on seven bonds since its invasion of Ukraine before the latest interest payments.

Moscow has scrambled in recent days to find ways of dealing with upcoming payments and avoid a default.

President Vladimir Putin signed a decree last Wednesday to launch temporary procedures and give the government 10 days to choose banks to handle payments under a new scheme, suggesting Russia will consider its debt obligations fulfilled when it pays bondholders in rubles.

One of the Taiwanese sources told Reuters that with the two eurobonds in question there was “no rouble clause attached”.

“The coupon cannot be paid in roubles instead,” the source added.

Russian debt makes up less than half a percent of Taiwanese bond holdings.

Moscow has been at risk of a default since its invasion of Ukraine saw Western powers freeze hundreds of billions of dollars of its currency reserves it held abroad and cut off large parts of its banking system from world markets.

The Kremlin has repeatedly said there are no grounds for Russia to default but is unable to send money to bondholders because of sanctions, accusing the West of trying to drive it into an artificial default.

While a formal default would be largely symbolic given Russia cannot borrow internationally at the moment and doesn’t need to thanks to rich oil and gas revenue, the stigma would probably raise its borrowing costs in future.

The country’s efforts to swerve what would be its first major default on international bonds since the Bolshevik revolution more than a century ago hit an insurmountable roadblock when the U.S. Treasury Department’s Office of Foreign Assets Control effectively blocked Moscow from making payments in late May.

Countries usually stop servicing their debt when they have little or no money left in international reserves and lack market access. But this case is different: A Russia default was unthinkable until recently, with the country rated investment grade prior to the Ukraine invasion.

Russia has not had a default of any kind since a financial crash in 1998 and has not seen a major international or “external” market default since the aftermath of the 1917 Bolshevik revolution.

Russia has some $40 billion of international bonds outstanding, around half of which are held by foreign investors.

Next Post

Cruise Lines Can’t Duck Their Debt

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

email

Get the daily email about stock.

Please Enter Your Email Address:

By opting in you agree to our Privacy Policy. You also agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!

Popular Posts

Breaking News

Fed sees interest rate hikes continuing until inflation eases substantially, minutes show

by
August 17, 2022
0

Federal Reserve officials at their July meeting indicated they likely would not consider pulling back on interest rate hikes until...

Read more

Fed sees interest rate hikes continuing until inflation eases substantially, minutes show

The Average 401(k) Balance by Age

FOMC Minutes "Participants anticipated that this slowdown in housing activity would continue"

Monkeypox cases jumped 20% in the last week to 35,000 across 92 countries, WHO says

Frenzied trading in meme stocks is a warning sign for the broader market

This Is How Many Years an Extra $100K Buys You in Retirement

Load More

All rights reserved by www.moneyprofitnews.com

  • Home
  • Breaking News
  • Privacy Policy
  • Email Whitelisting
No Result
View All Result
  • Email Whitelisting
  • Home
  • Privacy Policy

moneyprofitnews