The United States on Monday withheld payments made by the Russian government to holders of more than $ 600 million worth of Russian government bonds held by US banks. According to the Reuters news agency.

Russia’s central bank’s foreign exchange reserves with US financial institutions have been frozen under sanctions imposed after Russia’s invasion of Ukraine on February 24.

JPMorgan

Earlier, the US Treasury Department used the funds to allow the Russian government to pay for coupons in dollar bonds.

However, on Monday, the US government decided to block Moscow from accessing the frozen funds – including a $ 552.4 million recovery in maturity securities – due to a sharp fall in payments. A spokesman for the U.S. Treasury Department told Reuters.

Yesterday, the Russians had to pay a $ 84 million coupon for a government bond for 2042. Dollars were also demanded for this.

This is a transaction that takes place in a financial institution JPMorgan ChaseIt has so far been a reporter’s bank from Russia, which has been blocked by the Ministry of Finance, Reuters sources said.

Debt settlement or war

The United States forced the move to determine whether the Russians could use the accessible dollars to pay off their debt or for other purposes, such as paying for the war in Ukraine.

“Russia must choose whether to reduce its remaining valuable dollar reserves or bring in new revenue or default,” a US spokesman said.

Russia has 30 days to pay.

Historical default

Russia, with a total of 15 international bonds valued at about $ 40 billion, has so far been able to avoid repaying its international debt despite unprecedented Western sanctions. But the task becomes More difficult⁇

If Russia fails to pay the amount of the bond due within a predetermined period, or pays in dollars, euros or other currency fixed rubles, it is considered default. In this case, it would be too Historical default To go.

Sanctions imposed by Western countries prevent Russia from accessing international credit markets, but if it fails, access to those markets will be denied until the debtors are fully repaid. CNN⁇

(E.g.)