Russia on the brink of historic debt default as payment period expires

Some Russian bondholders told Reuters they were not getting the $100 million interest they were supposed to receive after the day. For many bondholders, failure to pay on time amounts to a debt default.

The Kremlin has repeatedly emphasized the idea that Russia will not default, but that sanctions against it may prevent it from sending money to bondholders.

Russia has been trying to continue the process of normal interest payments of $40 billion in debt since the outbreak of the Russo-Ukrainian war and the imposition of sanctions on it by many Western countries.

This is the first time that Russia has defaulted on its debts since 1918.

Russian Finance Minister Anton Siluanov suggested earlier this month that Russia may have found another means of payment. Moscow wired the $100 million in rubles to its domestic settlement house, but the two bonds in question are not subject to a ruble clause that would allow payment in the domestic currency to be converted overseas.

Reuters reported early on Monday, citing two sources, that some Taiwanese holders of Russian Eurobonds have not received the interest payments due on May 27, indicating that Russia may be entering its first foreign debt default since 1918, despite having ample cash and willingness to pay.