Demand for Russian Eurobonds Hits $6Bln Amid First Auction Since 2013

The amount of Russian government bonds from the foreign investors exceeds $6 billion, a banking source said Tuesday.

MOSCOW (Sputnik) — The amount of Russian government bonds demanded by foreign investors exceeds $6 billion, with the closure of the order book scheduled to take place after 11:00 GMT, a banking source said Tuesday.

On Monday, Russia announced return to the international bond market, launching its first Eurobond offering in two years. VTB Capital, a subsidiary of the Russian VTB Bank financial services corporation, had been designated to carry out the bond operations, with the bond yield reportedly set to be between 4.65 and 4.9 percent per year.

Total investors' demand for the 10-year bonds amounts to some $6.3 billion, the source said. According to Russia's budget forecast, the country is going to raise up to $3 billion on the international debt market this year.

Both Washington and Brussels had previously urged their respective banks against underwriting or purchasing Russian bonds. On Tuesday, US State Department deputy spokesman Mark Toner said that the United States has not changed its stance that US companies are exposed to economic and "reputational" risk in doing business with Russia as long as Ukraine-related sanctions are in place.

Relations between Russia and the West deteriorated amid the 2014 crisis in Ukraine. The European Union, the United States and their allies have introduced several rounds of anti-Russia sanctions since the reunification of Crimea with Russia in 2014, accusing Moscow of meddling in the Ukrainian conflict. Moscow has repeatedly refuted the allegations.

Russia last borrowed from foreign creditors in September 2013, when $6 billion worth of bonds were issued.