trueeconomics.blogspot.com / by Constantin Gurdgiev / February 2, 2015
BOFIT published an update on Russian external debt as of the end of December 2014. The update shows the extent of debt deleveraging forced onto Russian banks and companies by the sanctions.
In H2 2014, repayments of external debt accelerated.
Banks cut their external debt by USD43 billion to USD171 billion over the year, with much of the reduction coming on foot of two factors: repayment of maturing debt and ruble devaluations. Ruble devaluations – yes, the ones that supposed to topple Kremlin regime – actually contribute to reducing Russian external debt. Some 15% of banks’ external debts are denominated in Rubles.
Corproate external debt fell by USD60 billion to USD376 billion, with Ruble devaluation accounting for the largest share of debt decline, as about 25% of all external corporate debt is denominated in Rubles.
So do the maths: Ruble devaluations accounted for some USD16 billion drop in banks debts, and some USD54 billion in corporate debt in 2014 (rough figures as these ignore maturity of debt composition and timing).
The post Russian External Debt: Falling & So Far Sustainable appeared first on Silver For The People.
