Finance Ministry comes back to plans to place yuan-denominated bonds, could place before end of year - media
MOSCOW. Nov 1 (Interfax) - The Russian Finance Ministry has more than once announced plans to issue yuan-denominated bonds, and they have not yet been implemented, but it could place them before the end of this year, Reuters said, citing sources from the financial market and the ministry.
The provisional placement date will be the beginning of December and the Finance Ministry is hoping to attract a large circle of investors, from bankers and managing companies to brokers operating on the retail clients market, a ministry representative told Reuters. There could be several placements, each amounting to the equivalent of 100 billion rubles.
The Finance Ministry first announced plans to place yuan-denominated bonds on the Moscow Exchange in November 2015. This has been a regular topic of discussion since then.
It was initially planned that the bonds would be placed on the Moscow Exchange and the buyers would be large investors from mainland China. Representatives from the Finance Ministry said that this placement option had been complicated by the need to solve regulatory issues, partly relating to restrictions on Chinese investors purchasing foreign securities.
At the end of 2017, sources from Western and Russian media said that the Russian Finance Ministry would place the yuan-denominated bonds in a matter of weeks. Though the transaction did not take place in the end, these plans have not fallen off the agenda.
Timur Maximov, then Deputy Finance Minister and responsible for overseeing borrowing, said in September 2022 that the Finance Ministry had two models for placing yuan-denominated bonds. The first was more complicated and required the participation of Chinese investors. The second involved placing yuan-denominated bonds for local Russian investors. He said that this model could make sense if the federal budget starts financing its foreign currency operations in yuan, as the placement of yuan-denominated bonds means moving free yuan liquidity to budget accounts.
