This could be the first major foreign debt default since 1917, when the Bolsheviks refused to pay the tsarist debts.
If Russia covers the coupon debt on two issues of bonds in rubles, the agency will declare a sovereign default on the obligations of the Russian Federation after a 30-day period, reports the Chronicle.info with reference to Channel 24.
On Wednesday, March 16, Russia must pay $117 million on two issues of dollar bonds maturing in 2023 and 2043.
Russia cannot pay its debts in dollars
Against this background, the rating Fitch warned that if the Russian Federation, in the context of freezing a significant part of the country's foreign exchange reserves due to Western sanctions due to the war in Ukraine, makes payments in rubles, then it will declare a sovereign default on obligations following the results of a 30-day period (until April 16). RF.
Fitch also reported that the C rating in the national Russian currency is consistent with the fact that Russia did not provide foreign investors with coupons on bonds in national currency that expired on March 2.
It is our understanding that the Russian Ministry of Finance made these coupon payments on federal loan bonds (OFZ ) 2024 to the National Settlement Depository, but they were not paid to foreign investors due to the restrictions of the Central Bank of Russia,
— notes Fitch.
Experts emphasize that this could be the first major default on foreign debt since 1917, when the Bolsheviks refused to pay the tsarist debts.