Page 84 - bne IntelliNews Country Report: Russia Dec17

8.5.1 Fixed income - bond news
Leading consumer credit bank Russian Standard (Russky Standart) bank, owned by Rustam Tariko, defaulted on $451mn worth of Eurobonds , London's branch of Citibank announced in a document quoted by Vedomosti on November 29. Russian Standard Ltd issued Eurobonds in 2015 as part of restructure of two previous issues of $350mn and $200mn maturing in 2020 and 2024, respectively. The bonds holders received 18% of the older bonds' nominal value in cash, and new bonds for the remainder were issued with a coupon of 13%, maturing in 2022 and backed only by 49% in Russian Standard bank. Now Tariko is facing the loss of that 49% stake in his bank, while bonds holders may also demand seats on the company's board and initiate an audit.
Russian state-run lender VTB is considering a second issuance of bonds available to ordinary citizens, the so called "people's bonds", due to increased demands from the population, Vedomosti reported on November 23, quoting a source at the bank. Currently, the average purchase of VTB's "people's bonds", issued earlier this month, is RUB6.3mn ($107,000), the lender said. A private individual can obtain VTB "people's bonds" at any of the lender's offices, and the deal includes the opening of a broker account and a deposit account. The bonds have an 8% coupon and mature in 12 months.
The $544mn worth of Eurobonds of the Russky Standart (Russian Standard) bank and vodka producer did not pay the due coupon on October 30 , Vedomosti daily said on October 31 citing bondholders and market participants. Previously in September, the bonds sank on the fears of repeated restructuring. On September 8 Sberbank CIB said in a note to clients that Russky Standart had identified the bondholders for a repeated restructuring offer. "The bondholders have absolutely no clarity!" one of them told Vedomosti, adding that there was "neither a default announcement nor the [coupon] payment." The holding of Rustam Tariko has already restructured two issues of $350mnn and $200mn maturing in 2020 and 2024, taking in 18% on the nominal value in cash and issuing new bonds for the remainder with a
84 RUSSIA Country Report December 2017 www.intellinews.com