MOSCOW (Reuters) – The majority shareholder of sanctioned Russian private lender Sovcombank plans to buy back all the bank’s outstanding Eurobonds, worth more than $700 million, Sovcombank’s first deputy chairman Sergei Khotimsky told Reuters on Monday.
Sovcombank, one of Russia’s 13 “systemically important credit institutions”, was hit with Western sanctions in response to Moscow sending tens of thousands of troops into Ukraine last February, crippling its access to certain markets and creating headaches for bondholders.
The shareholder, Sovco Capital Partners, hopes to buy back four issues, all denominated in U.S. dollars and maturing in 2030.
“Although sanctions prescribe that investors stop any interaction with us, effectively writing off all investments to zero, we are trying to find more reasonable compromises with owners of any of our issues, who are willing to maintain dialogue,” Khotimsky said.
“We are talking about a price of around 40% of face value, which corresponds to market price levels for Russian bonds in foreign infrastructure,” he said, adding that investors in Russian assets and Russians holding assets abroad had all suffered because of sanctions.
Foreign investors from countries Russia considers unfriendly are successfully offloading billions of roubles worth of local debt holdings, selling the government’s OFZ treasury bonds at a steep discount, two financial market sources told Reuters last month.
(Reporting by Elena Fabrichnaya Writing by Alexander Marrow; Editing by Mark Potter)
