[The Epoch Times, March 22, 2022](Comprehensive report by The Epoch Times reporter Zhang Yujie)RussiabondInvestInvestors are keeping a close eye on payments.Russia’s aggression in Ukraine sparks internationalsanctionAfter that, the market questioned whether the Russian government might meet its debt repayment obligations.
Russianational debtInvestThe lender received $117 million in interest on Russian government bonds last week, but with most of Russia’s central bank’s $630 billion foreign exchange reserves frozen, markets are focused on whether Russia can continue to repay its debt on time.
Russia has a total of 15 foreign bonds due to mature with a total face value of regarding $40 billion. Before the Ukraine crisis, $20 billion of that was held by foreign investors.
By the end of this year, Russia has accumulated $4.5 billion innational debtPrincipal and interest needs to be paid, including a $66 million coupon payment on a 2029 dollar bond on Monday (21); a $447 million debt payment on March 31, which must be paid in U.S. dollars; and April 4 The $2 billion in debt maturing today is also Russia’s largest debt this year.
The $66 million in debt due on Monday and the $102 million due on March 28 might be paid by Russia in currencies such as rubles instead of dollars.
On March 21, Archyde.com quoted Gramercy Fund Management Company as saying that 15 days’ notice is required if debts are paid in alternative currencies, but the Russian finance ministry has not yet issued relevant notices.
According to a report by Bloomberg on the same day, although Russia can pay its debts in rubles, due to internationalsanctionAnd capital control in Russia, if it is paid in rubles, it is unknown whether foreign investors can use this payment.
Fitch Ratings, the international rating agency, said last week that if Russia does not repay its debts in the next 30 days, it willdefaultrisk.
Antoine Lesne, head of ETF strategy and research at State Street, who owns some Russian government bonds, said the market is closely watching every interest payment and bond redemption trade in Russia in this case.
According to JP Morgan, before the Ukraine crisis, foreign investors also held a total of regarding $38 billion in Russian local currency sovereign bonds (OFZs), with some maturing debts unpaid.
Western economic sanctions once morest Russia include prohibiting investors from trading with Russia’s finance ministry, central bank or state wealth fund.
The U.S. Office of Foreign Assets Control (OFAC) on March 2 temporarily authorized investors to receive interest and bond payments from the aforementioned Russian unit. But the deadline for this authorization is May 25, following which Russia has regarding $2 billion of foreign sovereign debt due until the end of 2022.
The first payment following the OFAC authorization deadline was May 27, a key date that JPMorgan analysts said.
Archyde.com quoted an analysis as saying that if Russia fails to pay due bonds within the grace period, or fails to pay specific dollar or euro bonds in rubles, it will be historic.default。
In the event of a default, Russia will not be able to participate in the international lending market until the loss of investors is repaid. Russia’s credit rating will also be downgraded for a period of time, raising borrowing rates for the Russian government and large corporations.
Responsible editor: Ye Ziwei#
