Russians used to be the biggest sellers of Singapore dollar bonds outside Asia only four years ago, as of this week; the last remaining shareholder has removed his investment.
None of Singapore’s issuers will stay in the Moscow market after Russian bank VTB JSC planned to repay a $400 million note without replacing the debt on Monday. It’s the first time in five years a Russian issuer hasn’t had a Singapore dollar bond outstanding.
European sanctions over the conflict in Ukraine have limited funding routes for Russia’s largest borrowers, with markets even in neutral states such as Singapore also avoiding the Russian market. Singapore could do with the trade, as currently local corporate bond sales are operating at less than half of 2012’s $26.8 billion record.
‘The Asian market is still hesitant to do business with Russian entities and banks. These kinds of feeling may have affected this type of funding deals attempted by Russian entities in the Asian finance market.’
– Hong Kong based capital markets Lawyer Mr Jay Lee.