News Column

Crisis keeps Russia from tapping local bond market

August 21, 2014

Russia has not tapped the local bond market for more than a month because of climbing borrowing costs, which most attribute to the Ukraine crisis, a senior official said on Wednesday.

"That is the fourth time in a row that we have cancelled a bond emission because we view the prices being proposed for the paper includes too much of a premium linked to the political situation," Deputy Finance Minister Sergei Storchak was quoted as saying by Russian news agencies.

He said the prices Russian and foreign investors were requesting did not respond to the liquidity risks they were taking on in buying the bonds.

According to RIA Novosti, the Russian government was planning to borrow 140 billion rubles ($3.9 billion, 2.9 billion) in the third quarter, but has been able to tap the local market only three times up to the middle of July.

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Source: Khaleej Times (United Arab Emirates)

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