Russia: bond investors receive payments

Passers-by in front of the Moscow Stock Exchange

Moscow Russia’s hotly-watched two-dollar bond payments are leaking to investors. Moscow has resorted to domestic reserves of US currency to do this, averting the first default on foreign debt in a century.

Three investors, who asked not to be named, said their custodians had received payments. At least one international clearing house has received and settled payments for the principal of a bond due 2022 and the coupon of a bond due 2042, according to people familiar with the transaction.

The complications in transferring the total of $650 million (€618 million) are a result of the sweeping sanctions imposed on Russia after invading Ukraine. These include action against some of the country’s largest banks, asset confiscations and a freeze on the central bank’s foreign exchange reserves.

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