- Russia denied defaulting on its foreign debt obligation on Monday after a grace period on a bond payment expired.
- A Kremlin spokesman said Western sanctions that blocked Russia’s May payment is “not our problem”
- On Sunday, Russia missed a deadline to pay $100 million in dollar- and euro-denominated interest on two foreign-currency bonds.
Russia denied Monday that it defaulted on foreign debt obligations, saying Western sanctions that blocked bond payments are “not our problem.”
Kremlin spokesman Dmitry Peskov, a Russian spokesperson, said that the Kremlin had successfully made bond payments due in May.
On Sunday, the country missed a deadline to pay $100 million in dollar- and euro-denominated interest on two foreign-currency bonds as a 30-day grace period from a May 27 due date expired.
Moscow said it had sent the eurobond payments to the country’s National Settlement Depository, Reuters reported last week. But the bonds’ covenants do not allow for payments in rubles, which means the payments would still constitute a default.
Russia has $40 billion in outstanding debt and has already reached near-default scenarios that were considered failure-to-pay events.
Sanctions have isolated Russia from the global banking community, with the latest blow coming Sunday when Britain, Canada, Japan and the US announced a joint ban on new imports of Russian gold.
But Moscow maintains that it has the funds to meet its obligations even as sanctions froze roughly $300 billion worth of reserve assets including gold.
Some Western officials have suggested that frozen Russian assets could be used to aid Ukraine. But the Kremlin on Monday reiterated its stance against that notion.
“Our reserves are blocked unlawfully and all attempts to use these reserves will also be unlawful and would amount to outright theft,” Peskov said.