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Foreign investors retain trust in Russia’s sovereign debt despite sanctions - ministry

Russian Finance Ministry Vladimir Gerdo/TASS
Russian Finance Ministry
© Vladimir Gerdo/TASS

MOSCOW, December 4. /TASS/. Russia’s latest issue of euro-denominated bonds was successful and proved that foreign investors have retained their trust to Russia’s sovereign debt despite sanctions, the Russian Finance Ministry said on Tuesday.

"The results of the deal demonstrate that foreign investors retain their interest to the Russian Federation’s sovereign debt and a high level of trust in fundamental indices of the Russian economy, although external conditions for the placement were far from being favorable," the ministry said.

Last week, the Finance Ministry opened its book for the placement of euro-denominated bonds that mature in seven years. It was the first issue of Eurobonds denominated in euro since 2013.

According to the Finance Ministry’s information, the placement found a lively response among European Union investors (18%), while investors from the UK bought most of the issue (55%). 3% went to investors from the U.S. and 24% - to Russian investors.

Russian issuers have not entered the international borrowings market for almost half a year since April 2018 when Washington widened sanctions once more against Russia. At the end of September, Deputy Finance Minister Sergei Storchak said that new Eurobond issues were unlikely by the end of 2018. Meanwhile, in November, for the first time in six months, Russian issuers conducted three transactions as Gazprom issued Eurobonds to the tune of 1 bln euro and RusHydro placed two issues worth 1.5 bln yuan and 15 bln rubles ($224.8 bln).