Bloomberg

Russia Pays $102 Million Coupon, Taking a Step Back From Default

Bloomberg News
Tue, March 29, 2022, 4:42 AM

Russia has made a $102 million interest payment as the world’s biggest energy exporter continues to service its foreign bonds despite financial isolation after the invasion of Ukraine.

The Finance Ministry said it transferred the funds to the National Settlement Depository in Russia, from where the coupon payment on the bonds maturing in 2035 is due to be distributed to investors. Capital controls and restrictions on the NSD’s accounts with the world’s biggest settlement systems have complicated and delayed the arrival of funds on previous payments.

Despite warnings from credit-rating agencies, the government has so far sidestepped a default since the war started and the sanctions were imposed. By transferring the cash, the Finance Ministry has performed its obligations under the bond terms “in full,” it said in a statement Tuesday.

On Monday the Ministry filed notifications for an “interest payment” and “principal repayment” on $2 billion of dollar-denominated debt due on April 4, the biggest security maturing since Russia was hit with sanctions following its invasion of Ukraine. It also filed a notification for a coupon on bonds due in April 2042. ... The National Settlement Depository, or NSD, in Moscow receives the Russian government’s payments on some of its foreign bonds for distribution.