Russia avoids public debt default

Russia made a coupon payment on Eurobonds worth $117.2 million, avoiding a default on the public debt.

“The Ministry of Finance of Russia informs that the payment order for the payment of coupon income on bonds of external bonded loans of the Russian Federation maturing in 2023 (ISIN XS0971721450 / US78307ADG58) and 2043 (ISIN XS0971721963 / US78307ADH32) in the total amount of USD 117.2 million dated March 15, 2022, sent to a foreign correspondent bank on March 14, 2022, has been executed," a message posted on the website of the Finance Ministry said.

Earlier, Finance Minister Anton Siluanov said that the department sent a payment order to the bank, and now the ball is on the side of the US authorities, which should allow payments from the frozen reserves of the Central Bank. In turn, the United States Department of the Treasury said that servicing the Russian government debt was subject to a license that allows operations until May 25.

The possibility of default on Russian Eurobonds was discussed against the background of the move to freeze gold and foreign exchange reserves of the Russian Central Bank denominated in dollars, euros, pounds and yen, and the ban on Russian Central Bank operations. The Ministry of Finance approved a temporary procedure for servicing Eurobonds, which involves making payments in rubles at the market rate in case it is impossible to make foreign currency payments.