Filenews 28 June 2022
Moody's announced that Russia has gone bankrupt in connection with servicing its foreign debt for the first time in a century, after bondholders did not receive $100 million in interest payments.
The unpaid payments come in the wake of a series of unprecedented Western sanctions that have largely isolated Russia after its invasion of Ukraine.
Russia lost the last way to service its foreign currency loans when the United States abolished an exemption last month that allowed American investors to receive Moscow payments.
"On June 27, Russia's sovereign debt holders had not received coupon payments for two Eurobonds worth $100 million by the time the 30-calendar day grace period expired, which we consider a default event according to our definition," Moody's says.
"Further defaults on future coupon payments are possible," the agency noted in a statement late Monday.
For its part, Moscow said on Monday that "there are no reasons to characterize this situation as bankruptcy", as payments did not reach creditors due to "the actions of third parties".
The last external bankruptcy of the country was in 1918, when the leader of the Bolshevik revolution Vladimir Lenin refused to recognize the huge debts of the regime of the deposed tsar.
CNA
