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29Jan18

Deputy Finance Minister points out Russia's OFZ bonds are risk-free assets

Russia offers favorable returns on its federal (OFZ) bonds, which can be viewed as risk-free assets, Deputy Finance Minister Sergei Storchak told reporters on Monday.

"These is because [Russian OFZ bonds - TASS] are risk-free assets with good earnings that simply do not have counterparts across the globe. Investors are now buying bonds of African states. Many of them are market newcomers and coupons with crazy rates are being offered. We offer normal returns now.

I believe we have risk-free assets," Storchak stated when commenting on higher demand for Russian securities.

Risk-free assets are "a great challenge for the modern world, where customarily developed risk-free economies make borrowings under almost negative interest rates," the official noted.

Higher demand for Russian bonds is not related to investor concerns on new US sanctions potentially affecting the coverage of Russian sovereign bonds, Storchak said. "If Moody's as an influential company in the United States and one of the strongest analysts changes the outlook [for Russia - TASS] several days' before the report's announcement, I do not think they would do that [if new US sanctions cover Russian bonds - TASS]," he added.

[Source: Itar Tass, Moscow, 29Jan18]
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