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Russia bans coupon payments to foreigners holding rouble bonds -Breaking


© Reuters. This illustration, taken on March 1, 2022, shows a Russian Ruble banknote in front of an ascending and declining stock graph. REUTERS/Dado Ruvic/Illustration

MOSCOW, Reuters – Russian central banks have temporarily halted payment of coupon coupons and a large international settlements system has stopped accepting Russian assets. Foreign investors remain stuck with their rouble-denominated bond holdings.

Russian National Settlement Depositary (NSD), an equivalent to Euroclear, Clearstream and Clearstream in terms of settlement system size, stated that it would limit payment options on Russian securities for foreign companies and individuals, and allow them to be transferred, if requested by the central bank.

The Bank of Russia directed depositories, registries and offices that trade on the securities exchange to stop foreigners from buying security products Monday. It didn’t specify the duration of this ban.

Moscow has taken the decision to close down Russian asset trading as part of its wider financial stability measures. It took these steps after Western countries placed a number of economic sanctions on Russia in order to penalize it for its invasion.

Euroclear, a Belgian company, stated in Tuesday’s note that it would no longer accept the Russian ruble as settlement currency. This effectively closes off an exit route to overseas investors.

Euroclear claimed that NSD has blocked their accounts in response to central bank actions.

According to the report, “All long balances should be wired in roubles immediately, as far as legally permitted.”

Euroclear stated that it will immediately close its account with its Russian correspondent bank.

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