Russia bans payments to foreigners holding rouble bonds, shares (updated)

Flint

02/03/2022 10:18

(Adds details, background)
    MOSCOW, March 2 (Reuters) - Foreign investors are
effectively stuck with their holdings of Russian stocks and
rouble-denominated bonds after the central bank put a temporary
halt on payments and major overseas' settlement systems stopped
accepting Russian assets.
    Moscow is blocking foreign investors, who hold tens of
billions of dollars worth of Russian stocks and bonds, from
exiting after its invasion of Ukraine triggered a wave of
economic sanctions and a haemorrhage of assets. urn:newsml:reuters.com:*:nL1N2V50G9
    The Bank of Russia said on Wednesday it had banned coupon
payments for foreign investors holding rouble-denominated
sovereign debt, known as OFZs, and Russian companies were also
barred from paying dividends to overseas shareholders. It did
not specify how long the curbs, which don't apply to local
investors, would last. 
    "Issuers are eligible to take decisions on paying dividends
and making payments on other securities," the central bank said
in a statement. "But actual payments ... towards foreign clients
will not be made. This applies to OFZs as well."  urn:newsml:reuters.com:*:nR4N2UR00X
    Foreigners held around 3 trillion roubles ($28 billion)
worth of OFZs out of a total market of 15.5 trillion roubles,
according to central bank data as of February 1. 
    The National Settlement Depositary (NSD), the Russian system
for overseeing the sale of securities, said separately it was
limiting payment options on Russian securities for foreign
individuals and companies, as well as a right to transfer such
assets, in line with a central bank request.
    The world's biggest settlement systems, Euroclear and
Clearstream, are no longer accepting Russian assets, effectively
shutting off an exit route for overseas investors.
    Settlement systems are a key part of the global financial
system, holding trillions of dollars of assets for banks and
investors and settling deals on their behalf.
    Belgium-based Euroclear said in a note on Tuesday that the
NSD had blocked its accounts as a result of the central bank
measures.
    "To the extent legally permissible, you should wire out any
remaining long balances in roubles as soon as possible," it
said.  urn:newsml:reuters.com:*:nL1N2V411J
    Euroclear said it would immediately disable its account at
its Russian correspondent bank, Dutch group ING. 
    Clearstream also informed its customers on Tuesday evening
that the NSD has blocked all securities held on Clearstream
Banking's FNH Account until further notice.
($1 = 108.6820 roubles)

 (Reporting by Moscow Newsroom; Editing by Carmel Crimmins)