Credit derivatives that Russian government bonds worth regarding 13 billion dollars (regarding 1.52 trillion yen) may be ineligible as deliverable debt at credit default swap (CDS) auctionsdecision committeeJudged on the 11th. Transactions that utilize CDS, which acts as insurance during Russia’s default, are increasing, but such hedging transactions are likely to be complicated.
After the three-day meeting, the decision-making committee said that the six Russian government bonds in question might not be considered as deliverable debt because they were allowed to pay in rubles instead of the issuing currency of dollars or euros. It pointed out. The maturity of these government bonds is 2025, 27, 29, 32, 35 and 36 years.
Putin tolerates external debt repayment in the ruble-exploring default avoidance
According to ICE Data Services, the cost of guaranteeing Russian bonds in CDS transactions suggests a probability of defaulting within five years is regarding 82%.
The Russian government is set to pay $ 117 million worth of interest on dollar-denominated bonds that do not originally have a ruble payment option on the 16th of this month. If this payment is made in rubles, it will be the default cause for CDS payments.
news-rsf-original-reference paywall">Original title:
news-rsf-original-reference paywall">Swaps Ruling May Complicate a Russia Default Insurance Payout(excerpt)
