Russia denies debt default, blames Western financial agents | Business and Economy News

Russia’s finance ministry has asked foreign bondholders to talk directly with those withholding their payments.

Russia has denied the claims Unable to pay foreign debt For the first time in more than a century, requests from investors to go to Western financial agents to receive the money Moscow requested were sent but not received by bondholders.

The White House said on Monday that Russia defaulted on international bonds for the first time since the Bolshevik revolution, as sweeping sanctions amid Moscow’s war with Ukraine cut the country out of the system. global finance effectively.

Kremlin spokesman Dmitry Peskov told reporters on Monday: “The claim of default is completely unreasonable.

“It is not our problem that Euroclear withholds this money and does not give it to the recipient. There is absolutely no basis to call such a situation a default,” he said.

Euroclear did not immediately respond to a request for comment.

Until last week, Russia continued to pay in foreign currency for its Eurobonds, however dollar and euro coupon transfers made in May did not reach investors. private. Moscow owes $100 million in interest on one dollar-denominated bond and one euro-denominated bond, which is initially due May 27.

On Monday, Russia’s Finance Ministry said “the actions of foreign financial intermediaries are beyond the control of the Russian Ministry of Finance”, and directed foreign bondholders to talk directly with holders back payments that Moscow claims to have made.

“The failure of investors to receive funds is not due to lack of payment but due to the actions of a third party and this is not directly stated as a default situation in the issuance document,” the ministry added. .

Last week, President Vladimir Putin ordered that debt obligations be considered fulfilled after a payment in rubles equivalent to the amount due is made. Bondholders need to open an account at a Russian bank to receive such a payment.

‘Financial nuclear bomb’

The Group of Seven Great Western Powers banned transactions with Russia’s central bank and froze their assets held in their jurisdictions, worth some $300 billion, after Russia invaded. Ukraine in February.

Some Western politicians have called for the seizure of Russia’s frozen reserves to rebuild Ukraine – and that’s the idea two senior Russian financial sources say they believe they were behind the default announcement. Monday, and what Moscow considers fake.

“By announcing a default, they can claim that sanctions are working. Economically, financially, property can be legally confiscated,” one of the two sources said.

Kremlin spokesman Peskov on Monday reiterated that Russia’s reserves had been frozen “illegally” and that any attempt to use them would “lead to outright theft”.

Russian Deputy Finance Minister Alexei Moiseev said: “I believe that a financial nuclear bomb was used against us, no country in the history of mankind has been subjected to such sanctions pressure as Russia Currently.

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