Russia Fails to Meet Bond Obligations, Triggering Swaps Payout
- CDS covered a net $1.5 billion of Russian debt as of end-May
- Still, decision can’t trigger wider default on Russia’s bonds
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Russia was judged to have breached the terms on a bond after missing a $1.9 million interest payment and triggering an insurance payout potentially worth billions of dollars.
The Credit Derivatives Determinations Committee said a “failure-to-pay” event occurred on credit-default swaps because Russia didn’t include the additional interest in a late bond payment made at the start of last month.