ADVERTISEMENT
Daily Expert News
No Result
View All Result
Friday, August 19, 2022
  • Home
  • World
  • Economy
  • Business
  • Markets
  • Arts & Culture
  • Education & Career
  • India
  • Politics
  • Top Stories
Daily Expert News
  • Home
  • World
  • Economy
  • Business
  • Markets
  • Arts & Culture
  • Education & Career
  • India
  • Politics
  • Top Stories
No Result
View All Result
Daily Expert News
No Result
View All Result
  • Home
  • World
  • Economy
  • Business
  • Markets
  • Arts & Culture
  • Education & Career
  • India
  • Politics
  • Top Stories
ADVERTISEMENT
Home World Europe

Russia misses bond deadline and signals first foreign debt default since 1918

by Nick Erickson
June 27, 2022
in Europe
129 4
0
Russia appears to be missing the deadline for paying off its foreign debts, leaving it in default.
152
SHARES
1.9k
VIEWS
Share on FacebookShare on Twitter
ADVERTISEMENT


Russia missed a deadline to make bond payments on Sunday, a move indicating it is defaulting on international debt for the first time in more than a century after Western sanctions thwarted the government’s efforts to pay foreign investors. The decline adds to efforts to cut off Moscow from global capital markets for years.

About $100 million in dollar and euro interest payments failed to reach investors within a 30-day grace period after a missed May 27 deadline. The postponement period ended on Sunday evening.

A formal declaration of default should come from bondholders, as rating agencies, which normally report when borrowers have defaulted, are banned from reporting on Russia by sanctions. The Credit Derivatives Determinations Committee, a panel of investors that decides whether or not to pay out securities related to defaults, has not yet been asked to make a decision on these bond payments.

But as it turned out, payments hadn’t arrived in bondholders’ accounts by Sunday evening, as required by the bonds’ contracts. On Monday, Russia’s finance ministry said it made the payments in May and transferred them to Euroclear, a Brussels-based clearinghouse, but then blocked it from reaching bondholders.

Russia rejects the default statement because it has made efforts to pay. Kremlin spokesman Dmitri S. Peskov told reporters Monday that the statements about the omission were “absolutely illegal”.

“The fact that Euroclear withheld this money did not transfer it to the recipients, it is not our problem,” said Mr Peskov. “In other words, there are no reasons to call this situation a default.”

The Treasury Department added that the actions of foreign financial institutions are beyond its control and “it seems advisable for investors to contact the relevant financial institutions directly” about the payments.

The risk of default arose in late February after Russia invaded Ukraine and imposed sanctions to separate the country from international financial markets. In late May, Russia tried to evade tougher sanctions that cut off access to US banks and bondholders by sending payments to a Moscow-based institution. But in the end, the funds did not quite make it into bondholders’ accounts due to far-reaching US and European sanctions.

This omission is unusual because it is the result of economic sanctions blocking transactions, not because the Russian government is out of money. Moscow’s finances remain resilient after months of war, with nearly $600 billion in foreign exchange and gold reserves, although about half of that is frozen abroad. And Russia continues to receive a steady influx of money from oil and gas sales. Still, a default would be a blemish on the country’s reputation that will linger in investors’ minds and likely drive up borrowing costs if it is able to tap into international capital markets.

Unlike other major defaults in recent history, such as in Greece and Argentina, the immediate economic and financial impact of this default on international markets and the Russian budget is expected to be relatively small.

First, Russia has already lost access to international investors, traditionally the worst consequence of default.

“The only clear negative outcome of the bankruptcy is that the external market is effectively closed to the Ministry of Finance,” said Sofya Donets, an economist at Renaissance Capital in Moscow. “But it’s already closed.”

Ivan Nechepurenko and Andrés R. Martinez reporting contributed.

ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
Tags: bondDailyExpertNewsDeadlinedebtdefaultForeignMissesRussiaSignals

Get real time update about this post categories directly on your device, subscribe now.

Unsubscribe
ADVERTISEMENT

Related Posts

Read your way around Reykjavík
Europe

Read your way around Reykjavík

August 17, 2022
Behind enemy lines, Ukrainians tell Russians: 'You are never safe'
Europe

Behind enemy lines, Ukrainians tell Russians: ‘You are never safe’

August 17, 2022
Your Wednesday briefing
Europe

Your Wednesday briefing

August 17, 2022
Ukraine strikes again in Crimea, challenging Russia's hold on peninsula
Europe

Ukraine strikes again in Crimea, challenging Russia’s hold on peninsula

August 16, 2022
UN chief discusses nuclear safety concerns in Zaporizhzhya with Russia's defense minister.
Europe

UN chief discusses nuclear safety concerns in Zaporizhzhya with Russia’s defense minister.

August 16, 2022
Ukrainian soldiers train for the front lines on British soil
Europe

Ukrainian soldiers train for the front lines on British soil

August 16, 2022
ADVERTISEMENT
  • Trending
  • Comments
  • Latest
This optical illusion has a revelation about your brain and eyes

This optical illusion has a revelation about your brain and eyes

June 6, 2022
NDTV Coronavirus

Viral video: Chinese woman pinned down, Covid test carried out by force

May 5, 2022
Hundreds In Sarees At UK

Hundreds of sarees at Britain’s Royal Ascot Horse Race to help Indian weavers

June 16, 2022
Sabrina's parents love her. But the meltdowns are too many.

Sabrina’s parents love her. But the meltdowns are too many.

June 1, 2022
Skyrocketing global fuel prices threaten livelihoods and social stability

Skyrocketing global fuel prices threaten livelihoods and social stability

1

Hello world!

0
NDTV News

IT startup Fareye aims to change Unicorn within a year, founder says

0
How did Stephanie Murphy, a holdout on Biden's agenda, help save it?

How did Stephanie Murphy, a holdout on Biden’s agenda, help save it?

0
NDTV News

Nifty, Sensex on track for fifth consecutive week of gains, defy a global gloom trend

August 19, 2022
Mouni Roy's vacation photos in a strappy summer dress are oh-so-chic

Mouni Roy’s vacation photos in a strappy summer dress are oh-so-chic

August 19, 2022
World Photography Day 2022: Here Are Some Wishes, Quotes To Mark The Day

World Photography Day 2022: Here are some wishes, quotes to mark the day

August 19, 2022
"Felt there must be...": Rohit Sharma on message to team after last T20 WC | Cricket News

“60 percent to India”: Former Pakistani star on why Rohit Sharma-led side leads the way in Mega Asia Cup clash | Cricket News

August 19, 2022

Recent News

NDTV News

Nifty, Sensex on track for fifth consecutive week of gains, defy a global gloom trend

August 19, 2022
Mouni Roy's vacation photos in a strappy summer dress are oh-so-chic

Mouni Roy’s vacation photos in a strappy summer dress are oh-so-chic

August 19, 2022

Categories

  • Africa
  • Americas
  • art-design
  • Arts
  • Asia Pacific
  • Astrology News
  • books
  • Books News
  • Business
  • Cricket
  • Cryptocurrency
  • Dance
  • Dining and Wine
  • Economy
  • Education & Career
  • Europe
  • Fashion
  • Food
  • Football
  • Gadget
  • Gaming
  • Golf
  • Health
  • Hot News
  • India
  • Indians Abroad
  • Lifestyle
  • Markets
  • Middle East
  • Most Shared
  • Motorsport
  • Movie
  • Music
  • New York
  • Opinion
  • Politics
  • press release
  • Real Estate
  • Review
  • Science & Space
  • Sports
  • Sunday Book Review
  • Tax News
  • Technology
  • Television
  • Tennis
  • Theater
  • Top Movie Reviews
  • Top Stories
  • Travel
  • Uncategorized
  • Web Series
  • World

Site Navigation

  • Home
  • Advertisement
  • Contact Us
  • Privacy & Policy
  • Other Links

We bring you the Breaking News,Latest Stories,World News, Business News, Political News, Technology News, Science News, Entertainment News, Sports News, Opinion News and much more from all over the world

©Copyright DailyExpertNews 2022

No Result
View All Result
  • Contact Us
  • Home
  • Top Stories
  • World
  • Economy
  • Business
  • Opinion
  • Markets
  • India
  • Education & Career
  • Arts
  • Advertisement
  • Tax News
  • Markets

©Copyright DailyExpertNews 2022

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.