Russia sends coupon payment in roubles on dollar-denominated Eurobond -ministry

Russia's finance ministry on Friday said it had sent a coupon payment of 8.5 billion roubles ($159 million) on a dollar-denominated Eurobond issue to the National Settlement Depository, as the prospect of a sovereign default draws ever closer. "Obligations on servicing the state securities of the Russian Federation were fulfilled by the finance ministry in full," the ministry said in a statement.

Russia's finance ministry on Friday said it had sent a coupon payment of 8.5 billion roubles ($159 million) on a dollar-denominated Eurobond issue to the National Settlement Depository, as the prospect of a sovereign default draws ever closer.

"Obligations on servicing the state securities of the Russian Federation were fulfilled by the finance ministry in full," the ministry said in a statement. The Eurobond in question matures in 2028. Similar coupon payments were made on Thursday on bonds maturing in 2027 and 2047.

Russia has been struggling to make payments on its $40 billion of international bonds since being hit with sweeping sanctions after sending tens of thousands of troops into Ukraine on Feb. 24. Dollar-denominated bonds usually have in their terms provisions that payments could under certain circumstances be made in euros, sterling, or Swiss francs.

However, they do not foresee payments in roubles, the currency Moscow is using. To avert default, funds broadly have to be paid in the correct currency into bondholders' accounts within the prescribed timeframe, which may include a 30-day grace period.

Moscow argues that paying in roubles constitutes Russia meeting its debt obligations as restrictions have blocked it from making some foreign currency payments in other jurisdictions. President Vladimir Putin signed a decree on Wednesday to establish temporary procedures aimed at fulfilling Russia's foreign debt obligations as the country teeters on the brink of default. ($1 = 53.3500 roubles)