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16 February 2016
VTB Capital’s Solovyev Sees Russia Selling Eurobonds This Year

Russia may sell foreign bonds in several currencies; of the new currencies it may offer, the yuan is the “most likely” candidate, Andrey Solovyev, global head of debt capital markets at VTB Capital in Moscow, says in interview.
  • Russia could sell yuan bonds in Hong Kong, mainland China or on Moscow Exchange
  • Eurobond will attract demand from foreigners, incl. Americans, because redemption proceeds from this yr and last need to be invested
  • State asset prices are below historical avg so it may be “more profitable” to borrow rather than privatization
  • Was surprised that Russia’s plan for foreign borrowing in 2016 is just $3b, Russia could easily sell $7b this yr
  • Finance Ministry will continue offering CPI-linkers and floaters at auctions since investors favor such instruments during volatility
  • Investors, such as pension funds, will be particularly interested in CPI-linkers amid inflation concern
  • Corporate Eurobond sales could resume in the spring; VTB Capital also working on Eurobond buybacks as some companies seek to reduce their foreign debt
  • Many companies are considering selling FX bonds on Russian mkt, however, selling USD bonds could be “problematic” for sanctioned cos. because of settlements

Corporate Communications VTB Capital