Russia Hints It May Force Ukraine Into Default, May Ask Ukraine For Its $20 Billion Share For Ex-Soviet Debt KYIV DEEMS THE ISSUE OF SOVIET-ERA DEBTS UNSETTLED, MOSCOW RESERVES THE RIGHT TO INSIST THAT UKRAINE REPAY $20 BILLION TO RUSSIA - RUSSIAN FOREIGN MINISTRY RUSSIA MAY ASK UKRAINE TO PAY ITS $20B SHARE FOR EX-SOVIET DEBT Pidgeon playing checkers response time. This should come as no surprise as we warned of at least $3b in bonds that are due very soon... the Ukraine owes $3 billion to Russia in bonds that have been issued under UK law. One of the stipulations of the bonds is that if the Ukraines debt-to-GDP ratio should exceed 60%, the bonds will become immediately callable. Once the Ukraine gets funding from the IMF, this is of course going to happen right away – its debt-to-GDP ratio will then most definitely exceed 60%, so the first $3 billion of any aid the Ukraine receives in the form of loans will right away flow into Russias coffers. Of course there may be litigation first, but as Greek bondholders have found out, all those who held bonds issued under UK law were actually paid in full, while everybody else had to accept the PSI and could basically go pound sand.
Posted on: Mon, 17 Mar 2014 18:40:27 +0000
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