Credit committee asked about Russia gov’t bonds after railways ruling – Reuters

Credit committee asked about Russia gov’t bonds after railways ruling – Reuters

LONDON, April 11 (Reuters) - Investors moved a step closer on Monday to a potential payout of billions of dollars in default insurance on debt issued by the Russian government and its entities as the country is on the brink of its first external default in over a century.

The EMEA Credit Derivatives Determinations Committee (CDDC) ruled on Monday that state-owned Russia Railways is in default on a missed bond payment, a key step in triggering so called Credit Default Swaps (CDS) - an instrument to insure exposure to default risk.

The decision, which marked the first time a Russia-originated debt instrument has been officially classified as defaulted since the country's invasion of Ukraine, was closely watched by creditors waiting to see whether the country's sovereign external debt might follow the same path.