7 Dec 2023 12:58

Russia's Finance Ministry implementing project to replace sovereign Eurobonds in 2024 - department director

ST. PETERSBURG. Dec 7 (Interfax) - Russia's Finance Ministry is implementing a project to replace sovereign Eurobonds next year, Denis Mamonov, director of the Finance Ministry's department for government debt and state financial assets, said in a statement.

"The project to place replacement bonds continues to be one of the priorities for the Finance Ministry, though we see a colossal burden on both the organizers of the placements and on the infrastructure on the part of the corporate segment. We see announcements of new deals every day. Therefore, we have decided that it would probably be better for us to implement the project next year," Mamonov said during a speech at the Russian Bond Congress, organized by Cbonds.

The State Duma in July approved amendments to the Budget Code proposed by the Finance Ministry that grant the government the authority to replace outstanding issues of Russian sovereign Eurobonds with new issues with similar terms and conditions in agreement with their owners.

The amendments allow the possibility to replace Russian Eurobonds on terms and conditions that stipulate the transfer/assignment of all rights if the transfer to the issuer of the replaced Eurobonds is impossible owing to restrictive actions of foreign states and/or international or foreign financial organizations.

Mamonov in early September said that the Finance Ministry expected to begin replacing Russian sovereign Eurobonds in the fourth quarter of this year.

"Owing to the sanctions on the part of foreign financial institutions regarding Russian securities, Russia's fulfillment of its obligations under Eurobonds has turned out to be difficult. At the first stage, the problem of rendering payments to Eurobond holders was resolved by creating a new, temporary mechanism established as per Russian presidential decree. The mechanism will continue to operate, though, as a result of the replacement, security holders will be able to replace their Eurobonds with securities with identical parameters, but issued under Russian law in the Russian financial infrastructure without the participation of foreign institutions," Finance Minister Anton Siluanov said about the potential replacement of Russian sovereign Eurobonds.