Russia Fails To Pay Scheduled Interest On Dollar Bonds

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Russia Fails To Pay Scheduled Interest On Dollar Bonds By Close Of Business In London

BY TYLER DURDEN

WEDNESDAY, MAR 16, 2022 - 02:25 PM


Holders of Russian government dollar bonds with coupons due on Wednesday have not received confirmation of payment as of close of business in London, according to Reuters, raising fears that the Russian default we previewed last night - the first since 1998 - may be imminent (once the 30 day grace period expires).



At issue are two dollar-denominated government bonds which have $117 million in interest due today. Failure to pay - or attempting to pay in rubles instead of dollars - would potentially place Russia in default by its creditors. As discussed last night, the bonds have a 30-day grace period, so creditors can't officially declare default until April 15.

Meanwhile, Russia is arguing that if it defaults it won't be its fault but rather that of sanctions: "The possibility or impossibility of fulfilling our obligations in foreign currency does not depend on us," FinMin Anton Siluanov told Russia Today. "We have the money, we paid the payment, now the ball is on the side, first of all, of the American authorities."



Earlier in the week, Siluanov indicated that the payment might end up being made in rubles because the central bank's foreign currency accounts have been bocked by sanctions.



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