Publication: Monitor Volume: 3 Issue: 52

Russia successfully launched its second international bond yesterday, a seven-year eurobond denominated in German Marks. The issue — only the second Russia has made since the 1917 Revolution and the first to be denominated in DM — raised DM 2 billion ($1.2 billion). The issue was larger than expected, but the Russian government was forced to offer a higher than expected interest rate premium and, in contrast to Russia’s debut $1 billion eurobond of last year, the entire offering was not sold out on the first day. The bond is priced to yield 3.7 percentage points over German government bonds and pays a 9 percent annual coupon. The high premium comes in reaction to an anticipated increase in U.S. interest rates which is depressing emerging market bond prices across the board. (Financial Times, March 13-14)

Moscow Looks Ready to Bargain on Relations with NATO.