Russia Hopes for Successful Talks With Clearing Houses to Boost Eurobond Demand
25 Maggio 2016 - 12:51PM
Dow Jones News
By Andrey Ostroukh
MOSCOW--Russia hopes for successful talks with international
clearing houses to boost demand for the country's Eurobonds amid
sanctions, the head of VTB, the bookrunner of the latest Eurobond,
said Wednesday.
Russia on Tuesday managed to tap international debt markets for
the first time since the West imposed sanctions two years ago, a
move officials touted as a vote of confidence in the country's
financial health. But Moscow raised just over half of the amount
expected as a number of global portfolio managers didn't
participate in the bond sale, citing concerns about compliance and
issues over the settlement of the bonds.
Andrei Kostin, chairman of state-run VTB bank, said he hoped
that negotiations with Euroclear PLC, international clearing
system, would be successful in the future, which would boost demand
for Russian bonds.
The bond's prospectus said it would be settled through Russia's
National Settlement Depository.
Euroclear and Clearstream, another clearing firm, have so far
declined to comment on the bond sale that Russia unexpectedly
announced on Monday. Russia's finance ministry said it sold $1.75
billion of so-called Eurobonds amid demand of $7 billion. The
Russian government's borrowing plan envisages raising $3 billion
from global markets this year to help cover a budget shortfall
triggered by weak prices for crude oil, Russia's main export and a
large source of state revenue.
More than 70% of the bond was purchased by foreign investors,
Finance Minister Anton Siluanov said.
Mr. Kostin said that many foreign buyers were forced not scrap
plans to purchase Russian Eurobonds because of pressure from the
U.S. State Department. To encourage those investors who were brave
enough to buy into Russia, Moscow offered some premium to the
secondary market, Mr. Kostin said.
Write to Andrey Ostroukh at andrey.ostroukh@wsj.com
(END) Dow Jones Newswires
May 25, 2016 06:36 ET (10:36 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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