Vladimir Putin signed a decree allowing the payment of debt on Eurobonds in rubles. Payouts will be calculated based on the rate in the domestic market.
As stated in the document, the government will select banks within ten days, in which they will create special accounts for debt payments. Their bthe beneficiaries will be Eurobond holders. As soon as the necessary funds are received there, the debt obligations will be considered fulfilled.
International rating agencies consider the fulfillment of obligations on foreign currency debt in rubles as a default.
The Ministry of Finance has been experiencing problems with foreign exchange settlements since March. At first, he paid off the debt from frozen foreign exchange reserves, but then the United States imposed a ban on this mechanism, and in May did not renew the license that allowed Russia to service external debt. The first payments after the revocation of the license are scheduled for June 23-24. Then Finance Minister Anton Siluanov announced a new payment mechanism that could bypass all Western settlement infrastructures. “We will try to pay off our obligations,” he said. “And we will find such a form.”
Russia needs to pay $490 mln on Russia-28 Eurobonds on June 24. Unlike the May payments, which, according to the terms of the issues, could be made in euros, pounds and Swiss francs, for the June payments only one currency is possible – the US dollar.