MOSCOW—Russia enjoyed strong demand for its first-ever Treasury
bonds linked to inflation from buyers across U.S., Europe and Asia,
Finance Minister Anton Siluanov said on Thursday.
Mr. Siluanov said he was "satisfied" with demand for new bonds
as bids exceeded the amount of bonds on offer. He didn't disclose
information about the size, the expected yield of the issue or its
demand.
The Finance Ministry started accepting bids for the
ruble-denominated Treasury bonds at midnight on Wednesday, and was
supposed to close the book on Thursday at noon Moscow time (0900
GMT).
Russia has been looking for ways to track high inflation for
years. With inflation-linked bonds, the ministry intends to launch
a benchmark for the market, which it expects would also provide a
clear indicator of inflationary expectations.
"Among investors there is a substantial number of foreign buyers
from the U.S., Europe and Asia. We can de facto state that Russia
has successfully returned to the international capital market," Mr.
Siluanov said.
Gazprombank, and state-run lenders VTB Capital and Sberbank CIB
organized the placement of bonds, known as OFZs.
Russia, being cut off from global capital markets by Western
sanctions, said earlier this year that the inflation-linked bonds
were expected to have a tenor of up to 10 years, with yields linked
to annual inflation readings.
Inflation-linked OFZs were expected to see demand as they offer
yields akin to Russia's annual inflation rate, currently above 15%,
and a coupon. In the future, however, bonds may lose their appeal
as the central bank plans to bring inflation to a 4% target in the
next year or two, analysts said.
Analysts welcomed the plan, saying that foreign investors, who
don't have to pay Russia's domestic taxes, may like the new
bonds.
Mr. Siluanov said that settlement is due by July 21.
Write to Andrey Ostroukh at andrey.ostroukh@wsj.com
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