The government of Russia has been able to stave off a default by sending dollars to foreign holders of its bonds, but there are more difficult deadlines for payments this year.
A person familiar with the matter said that Moscow sent $117 million to cover coupon payments on two of its dollar-denominated bonds.
The person said that JP Morgan first asked the US government for permission to process the payment before sending it to Citigroup. Neither Citigroup nor JP Morgan would comment.
One bondholder, who asked not to be named, told Insider that they received payment in dollars on Friday. The investors in the UK, Germany and the US said they received their money at the end of last week.
Russia avoided its first foreign debt default since 1918 because of payment. It helped calm nerves in global markets last week, with the S&P 500 rising more than six percent.
The danger is not over. Russia has roughly $40 billion of foreign bonds. According to analysts at JP Morgan, it will have to pay $4.7 billion this year.
Payment could be difficult due to the Western sanctions on the country&s financial system that were put in place after the invasion of Ukraine. Ratings agencies have slashed Russia's credit rating deep into junk territory, meaning that a default could happen soon.
The head of global fundamental credit strategy ofDeutsche Bank said that Russia's remaining interest repayments will keep investors anxious.
Russia will have to make another $615 million in coupon this month. It has to pay back $2 billion to investors on April 4.
Some of the bonds have contracts that allow the government to pay back investors in rubles, rather than dollars. The Finance Ministry believes that sanctions may force Russia to go down this route.
Russia is due to make a coupon payment of $66 million on a dollar bond on March 21, with a grace period of 30 days. The contract states that Russia can pay in euros, British pounds, Swiss francs or rubles.
S&P slashed Russia's credit rating even deeper into junk territory last week despite the government's assurances it had paid up.
Technical difficulties stemming from Western sanctions have complicated Russia's ability to meet bond payments.
They said that debt service payments on Russia's Eurobonds may face similar technical difficulties. A Eurobond is a foreign currency bond.
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