Russia is on the verge of defaulting on foreign debt – S&P
Russia is on the verge of defaulting on foreign debt. The aggressor country offered the owners of the two bonds payments in rubles, not dollars. This was reported by the rating agency S&P.
It is noted that investors are unlikely to be able to convert rubles into “dollars equivalent to the appropriate amount.”
Russia has a 30-day grace period from April 4 for capital and interest payments, but the rating agency S&P does not expect them to convert into dollars, given Western sanctions.
Restrictions undermine Russians’ “readiness and technical ability to meet the terms of their commitments.”
Earlier, the Bloomberg news agency reported that Russia’s external default is inevitable. This is evidenced by the fact that the Russian Treasury has stopped paying dollar debts from Russia’s accounts in American banks.
The last time Russia defaulted was in 1998, but it was about domestic debt. Externally, the last default was after the 1917 revolution.
Default is the failure to fulfill the obligations of the debtor to pay the debt: both interest on it and the principal amount borrowed.
In the event of a default being declared by a company or individual, a bankruptcy procedure follows, during which procedures are established for the return of the debt, its full or partial write-off.
