MinFin transfers 18.3 bln rubles to NSD to pay coupon, part of principal on Russia 2030 Eurobond

MOSCOW. Oct 3 (Interfax) - The Russian Finance Ministry, in line with a June 22 presidential decree, has transferred 18.3 billion rubles, the equivalent of $319.3 million, to the National Settlement Depository (NSD) to make coupon payments and pay a portion of the principal on Russian sovereign Eurobonds maturing in 2030, the Finance Ministry said.

The NSD has received the funds, and thus, obligations to service Russia's government securities are fulfilled in full, the ministry said.

This is a bond issue with an amortization structure. The Russia 2030 Eurobonds were issued as a result of the restructuring of the former Soviet Union's debts to the London Club of countries in 2000.

The June 22 presidential decree approved a new procedure for servicing the foreign sovereign debt under which all payments on Russian sovereign Eurobonds are made in rubles. The Finance Ministry has divided holders of Eurobonds into three groups, depending on the infrastructure through which their ownership rights are recorded.

The first group includes investors who hold their bonds in depo accounts at the NSD or its Russian sub-depositories; payments to these bondholders are made in the usual way and no additional actions are required from them.

The second group consists of investors whose bonds are held in a Russian depository that is itself a depositor of a senior foreign depository. Payments to them will be conveyed by the NSD through Russian depositories, bypassing foreign intermediaries, after the disclosure of information about the number of recorded bonds attributable to their depositors.

The third group consists of investors whose bonds are held directly in foreign depositories. Payments intended for them are transferred to a special "I" type ruble account at the NSD, where the funds are indexed according to the current market exchange rate of the currency in which the bonds are denominated until the actual payment to the bondholder. Investors in this group have to independently contact the NSD or an intermediary organization and provide documentary confirmation of their ownership rights to the Eurobonds.

Finance Minister Anton Siluanov said earlier that foreign investors are "wary" of the possibility of getting payments in rubles on Russian sovereign Eurobonds given the risks of sanctions.

"The position is very wary, since the Finance Ministry, like a number of our other agencies, has been hit by sanctions and relations with the Finance Ministry are a risk for foreign debt holders. Therefore, we're seeing a very, how shall I say, wary attitude toward cooperation on receiving coupon income on bonds," Siluanov said.