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Russia defaults on Eurobonds: Moody’s

FILE - This August 2010 file photo shows a sign for Moody's Corp. in New York. America has a debt problem, and the big borrower this time may surprise you: Corporate America. At many businesses, cash is falling, debt is ballooning and finances are getting worse. Formerly highly-rated corporate borrowers that are cut to junk and thus made too risky for many bond funds are known as "fallen angels." Moody’s tallied 56 fallen angels in the first six months of 2016. (AP Photo/Mark Lennihan, File)

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New Delhi: Moody’s said that Russia had defaulted on its foreign debt obligations, according to a statement published on the agency’s website on Monday.

“On 27 June, holders of Russia’s sovereign debt had not received coupon payments on two Eurobonds worth $100 million by the time the 30-calendar-day grace period expired, which we consider an event of default under our definition,” the statement said.

In May, the United States let lapsed its license to pay bondholders which allowed Russia to service its foreign debt. Last week, Russia for the first time used a new mechanism to pay its Eurobond coupon in rubles. Finance Minister Anton Siluanov said this was in no way a default. According to Siluanov, the United States and the European Union are cooking up fictitious obstacles to servicing Russia’s foreign debt in order to “put the ‘default’ label on it.

Moody’s Corporation is an American financial services company that acts as the holding company for Moody’s Investors Service and Moody’s Analytics. Moody’s Investors Service provides investors with credit ratings, risk analysis, and research for stocks, bonds, and government entities.

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(Vinayak)