Gazprombank working with market, Central Bank of Russia on creating local convertible bonds instrument, expects launch in 2025

MOSCOW. Jan 13 (Interfax) - Gazprombank is actively collaborating with the regulator and market participants to enable the issuing of the first convertible bonds on the Russian local market, the bank's first vice president, Denis Shulakov, said in an interview with Interfax.

Convertible bonds are an innovative instrument made up of three elements, combining the advantages of bonds, stocks and options, Shulakov said.

The current legislation does not allow for the issuing of such an instrument in its classical sense, as it lacks flexibility in determining the conversion ratio and the method of settlement during conversion, he said.

"We are actively working with market participants and the regulator to create opportunities for the first issuing of convertible bonds on the Russian local market. I am confident that 2025 will bring this new investment instrument to the market," he said.

The Central Bank of Russia said previously that convertible bonds are a promising instrument. Last autumn, the CBR included plans to improve convertible bond regulation in its draft of the main directions of the Russian financial market's development in 2025 and the 2026-2027 period. Such instruments could play a significant role in increasing investment, including by companies contributing to technological sovereignty and the structural adaptation of the economy, the CBR said.