Free Trial

Russia CDS Signal 80% Chance of Default on Ruble Payment Concern

  • The cost of insuring Russia’s government debt surged on Monday to signal a record 80% probability of default after President Vladimir Putin signed a decree saying Russia will be allowed to repay foreign creditors in rubles.
  • Credit-default swaps insuring $10 million of the government’s bonds for five years were quoted at about $5.8 million upfront and $100,000 annually, according to ICE Data Services
  • That’s up from about $4 million in advance last week
  • Protection sellers have been demanding upfront payment in recent weeks, signaling perceptions that default risk is imminent
  • Investors are concerned that Russia might trigger the contracts if it repays foreign-currency debt in rubles
  • Some of Russia’s international bonds allow repayments in rubles
  • The two dollar bonds with $117 million worth of coupons due on March 16 don’t have that option
MNI London Bureau | +44 020-3983-7894 |
MNI London Bureau | +44 020-3983-7894 |

To read the full story



MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.