Friday, April 12, 2024

Russia defaults, now Moscow will pay its debts only in rubles-

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The Russian Central Bank meets on the same day to address the thorny issue of repaying the union’s external debt and Avoid imminent default. worry Moscow US decision not to extend waiver This allowed Russia, despite sanctions against banks and isolation from financial markets, to pay bond transactions in dollars. So much so that the Russian Finance Ministry announced the switch to the ruble.

Moscow Declaration

“Given that the refusal of (the United States) to extend this authorization makes it impossible to continue to meet the external debt in dollars, the debts will be repaid in Russian currency with the possibility of their subsequent conversion into contractual currency through the Russian Central Depository System (Nds) which will act as a payment agent,” The ministry explained in a statement, which confirmed that “the Russian Ministry of Finance, as a responsible operator, confirms its readiness to continue fulfilling all its financial obligations.” Finance Minister Sekou Anton Siluanov: “We have the money and the will to pay.”

Payment schedule

So Moscow carefully considers its payment schedule. Among the future commitments There is a Euro bond at 2036 with a coupon due on Friday but with the possibility of payment in rubles. On the other hand, the 2026 dollar bond envisions only the pound sterling, the euro or the franc as alternative currencies. Also, there is no payment in rubles for coupons due at the end of June for three other bonds. In general, the Russian government is now in a position to repay About $20 billion in bonds and about $500 million in interest next month.

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He also awaits the next deadline, Friday, for two loans in euros and Moscow dollars, which must include the payment of the total interest of $100 million. After that, the Russian government will have 12 deadlines until the end of the year.

official line

At the end of April, the Governor of the Central Bank of Russia, Elvira Nabiullina, admitted that Moscow would have “difficulties in repaying”, but refused to talk about the possibility of its bankruptcy. Russia’s external debt is currently between 4,500 and 4,700 billion rubles (between $78 and 81 billion at current rates), or about 20% of the total public debt.

Ike Walton
Ike Walton
"Infuriatingly humble analyst. Bacon maven. Proud food specialist. Certified reader. Avid writer. Zombie advocate. Incurable problem solver."
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