UPDATE 4-Russia raises € 1.5 billion Eurobonds as market cheers US talks


* Russia raises € 1 billion in new Eurobonds 2036

* Russia raises 0.5 billion euros of top-up on Eurobond 2027

* Demand exceeds 2.1 billion euros

* Russian investors are the main buyers of sovereign debt

* Foreigners still interested in Russian bonds, says FinMin

* Foreigners held 54% of Russian Eurobonds as of April 1 (adds a comment from the Ministry of Finance)

MOSCOW, May 20 (Reuters) – Russia on Thursday raised 1.5 billion euros ($ 1.83 billion) in two Eurobond issues, benefiting from offers worth more than 2, 1 billion euros, as the markets welcomed the negotiations between Moscow and the main diplomats in Washington and the relaxation of some US sanctions.

Demand from Russian investors helped the finance ministry tap the global debt market for the first time in 2021, with the country’s three largest state-owned banks – Gazprombank, Sberbank CIB and VTB Capital – arranging the sale.

Russia sold € 1 billion in a new 15-year Eurobond with a yield of 2.65% and an additional € 500 million in a complementary 2027 Eurobond issue at 98.5% of its nominal prices, a declared VTB Capital.

Russian investors bought 47% of the new Eurobond 2036 and 65% of the Eurobond 2027, while the rest was bought by investors from Austria, Germany, France and the United Kingdom, as well as the Middle East and Asia, said VTB Capital.

“Despite the widening of anti-Russian sanctions this year, international investors are still showing sufficient interest to invest in Russian debt securities,” the finance ministry said.

VTB Capital did not mention the US investors taking part in the placement, seen as a move to defy the lingering geopolitical risks that have plagued Russian markets.

Russia entered the Eurobond market ahead of a summit between President Vladimir Putin and his US counterpart Joe Biden scheduled for next month and after the US imposed sanctions on Russia for suspected malicious activity, this that Moscow denies.

The new sanctions ban U.S. banks from buying Russian ruble-denominated sovereign debt directly from mid-June, in addition to the current ban from buying sovereign Eurobonds directly from Russia.

Russia placed Eurobonds the day after US Secretary of State Antony Blinken spoke with Russian Foreign Minister Sergey Lavrov at their first in-person meeting to find ways to work together.

Washington also lifted some sanctions on the Nord Stream 2 gas pipeline that Russia is building to bypass Ukraine, which Russia says could help normalize relations that have deteriorated since the annexation of Crimea by Moscow in 2014.

Russia’s 2021 Eurobond plan plans to borrow the equivalent of $ 3 billion, which it can raise through two weekly OFZ Treasury bond auctions at home. ($ 1 = 0.8187 euro) (Additional reports by Anton Kolodyazhnyy, Alexander Marrow, Andrey Ostroukh and Elena Fabrichnaya Writing by Katya Golubkova and Andrey Ostroukh, Editing by William Maclean, Kirsten Donovan, Chizu Nomiyama and Jonathan Oatis)


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