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. Last Updated: 07/27/2016

Domestic Debt at $22.42Bln After Restructuring Program




Russia's outstanding domestic debt has fallen to 550 billion rubles ($22.42 billion) from 750 billion after a major restructuring, the Finance Ministry's securities department head said Monday.


"Russia's domestic debt has decreased as a result of the debt swap - since we are not borrowing anything, but something is being repaid - to 550 billion rubles, and the sum of the debt will be just 350 billion rubles by Jan.1, 2000," Bella Zlatkis told a seminar.


The Russian government on Friday closed bidding for a program to exchange GKO treasury bills and OFZ bonds frozen last summer for new paper.


Zlatkis said only 4 billion rubles worth of government paper held by local investors were not restructured.


Only 40 percent of foreign holders bid for the swap, she said.


"We shall be processing bids for another week," Zlatkis said. "In general, practically all nonresidents blocked their paper until repayment which means they are thinking and must take a decision before April 27."


She did not clarify what she meant, but the restructuring program only officially ends on April 27, a week after the bid deadline.


Foreign investors have been angered by the restructuring terms, saying they were confiscatory. Zlatkis said the Finance Ministry on Friday had received a restructuring bid from five big foreign investors worth a total 1.5 billion rubles.


Under the restructuring, investors exchange paper for a package of 10 percent cash, 20 percent investment bonds, which can be used to pay overdue taxes or to buy local shares and 70 percent of bonds with a sliding coupon.


Zlatkis said the Finance Ministry would soon issue a regulation outlining how tax arrears could be paid with some of the paper.