US Treasury Department blocks Russian coupon payments for sovereign bonds
Russia has failed to pay its debt on bonds in 2022 and 2042 – the US Treasury Department has blocked the processing of payments by JPMorgan (JPM). This was reported by CNN with reference to a spokeswoman for the Ministry of Finance and a source familiar with the matter. Thus, the Russian Federation has not repaid the debt, and therefore – is close to default.
“Today is the deadline for Russia to make another debt payment. From today, the US Treasury will not allow any payments for debts in US dollars from accounts Russia has to choose between depleting its balance of valuable dollar reserves or new income (foreign exchange earnings – Ed.), or default, “- quoted by CNN.
Russia has 30 days grace period to still make a payment. If it does not make payments on the bonds within the prescribed period or pays in rubles where the contract stipulates payment in dollars/euros, it will be considered a default.
Russia no longer has access to international borrowing markets. However, default will block it until the debts are fully repaid. Or until all cases related to default are resolved in court.
