Russia makes early debt payment dash in bid to swerve default

　　div classBodysc17zpet90 cdBBJodivpLONDON Reuters – Russia initiated payment on two of its external bonds on Friday in an attempt to stave off a looming sovereign default ahead of a key U.S. licence allowing such transfers expiring next week. p

　　pThe finance ministry said it channelled 71.25 million on coupon payout for dollardenominated Eurobonds maturing in 2026 and 26.5 million euros 28 million on papers due in 2036.pdivdivdiv classBodysc17zpet90 cdBBJodiv

　　pRussia has faced the prospect of sovereign default since Western capitals imposed sweeping sanctions in the wake of its invasion of Ukraine on Feb. 24 as well as Moscow introducing countermeasures. The country has been all but severed from the global financial fabric. p

　　pThe two payments had been due on May 27, but Russia is relying on a licence by the U.S. Treasury to be able to transfer the money to international bond holders – a key part of avoiding a sovereign default. That licence runs out on May 25. p

　　pRussias national settlement depository had received the funds the ministry channelled, the finance ministry said. p

　　pIt was unclear it the depository would be able to channel the funds itself so they could reach foreign holders of Russian Eurobonds.p

　　pJPMorgan, which previously acted as a correspondence bank on such payments, did not immediately respond to a request for comment. p

　　pRussian Finance Minister Anton Siluanov said on Wednesday that Moscow would service its external debt obligations in roubles if the United States blocks other options and would not call itself in default as it had the means to pay.p

　　pDespite the plethora of curbs, Russia has managed to make payments on seven bonds since its invasion of Ukraine before the latest interest payments.p

　　pRussia has some 40 billion of international bonds outstanding, around half of which are held by foreign investors. It has less than 2 billion in payments related to its hardcurrency bonds coming due until yearend.p

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　　pp Reporting by Karin Strohecker, editing by Nick Macfiep

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