(Reuters) – Russian Finance Minister Anton Siluanov said on Wednesday that a proposed sovereign Eurobond buyback would stop discrimination against Russian bond holders, who he said were not able to access funds sent to settlement system Euroclear, Interfax reported.
Russia has offered to buy back dollar bonds maturing next week in roubles in a move seen by analysts as helping local holders of the $2 billion sovereign issue receive payment, while also easing the country’s hard-currency repayment burden.
“This is because we see money coming into Euroclear successfully reaching foreign holders, money on our debts,” Interfax quoted Siluanov as saying. “And settlements are frozen for Russian resident holders.
“So in this case we have offered to settle directly with our residents in roubles, so as not to discriminate against our security holders and have proposed the possibility of buying back our debt from Russian residents.”
The finance ministry offer on Eurobonds maturing on April 4, Russia’s biggest debt payment this year, follows Western moves to tighten sanctions against the country over its actions in Ukraine and to freeze Moscow out of international finance.
The rouble initially crumbled after the sanctions, plunging as much as 40% against the dollar since the start of 2022, but it has recovered some ground since then, trading at around 83 to the dollar on Wednesday.
That is some way off levels of around 75 seen before Russia began what it calls a special operation in Ukraine, but there were signs that the move may be popular among Russian bond holders.
“Some Finam clients have those Eurobonds in their portfolio and they plan to take part in the finance ministry’s buyback,” said Dmitry Lesnov, head of Finam brokerage’s client service development department.
“The benefit of this decision may be that clients receive certainty on their positions and will be able to receive payments on assets, in spite of restrictions, introduced by European depositories Euroclear and Clearstream,” Lesnov said.
(Reporting by Reuters; editing by Guy Faulconbridge and Mark Trevelyan)
