Belarus continues to service foreign debt in national currency

August 25, BPN. The Ministry of Finance says that on August 24 that it paid in rubels on US-dollar denominated Eurobonds maturing in 2026 and 2031. It was the second payment in the Belarusian currency linked to sanctions limiting the country’s ability to deal in foreign currencies.

According to the ministry’s press office, the new coupon payments equivalent to $38.6 million were “made in full,” as decided by the government and the National Bank.

It said the paying agent, Citibank, N.A. of London, has been granted “access to these funds.”

The payment was made to a dedicated account at Belarusbank.

On June 28, the Council of Ministers and the National Bank in a joint resolution declared their intention to service Belarus’ foreign debt in rubels. On the next day, the Belarusian finance ministry reported the first rubel payment of interest on the 2027 Eurobond denominated in US dollars.

Shortly thereafter, rating agencies Fitch and Moody’s downgraded Belarus’ credit rating: the former said its default was inevitable, and the latter described the existing situation as a default.

The Belarusian Ministry of Finance criticized these decisions.

On August 4, S&P Global Ratings cut Belarus’ long-term foreign currency rating to SD (selective default) and said it has defaulted on Eurobonds (D).