OREANDA-NEWS The Russian Ministry of Finance has announced the upcoming placement on the Moscow Stock Exchange of the first ever issue of federal loan bonds (OFZ) in Chinese yuan.

The technical placement is scheduled for December 8, and the collection of applications is scheduled for December 2. The agency will determine the volume of government debt issuance and coupon rates after the demand becomes clear.

Investors will be offered two OFZ issues with a permanent coupon yield with maturities from three to seven years, a coupon period of 182 days and a nominal value of 10,000 Chinese yuan per bond, which is 114.2 thousand rubles at the exchange rate on November 12. It will be possible to buy securities and receive payments on them in both currencies.

Until 2022, the Ministry of Finance, in addition to ruble-denominated bonds, offered classic Eurobonds to investors, but then lost this source of financing. Prime Minister Mikhail Mishustin spoke about the possibility of placing OFZs in the currencies of friendly countries back in March 2023, but it has not been implemented in the past 2.5 years.

As for the Chinese yuan, the Ministry of Finance wanted to sell government debt in it ten years ago. In those years, the process was hampered by regulatory restrictions from China.

At the end of October, the media reported on the preparation of such a release. At that time, Reuters sources claimed that the authorities were planning four bond issues worth up to 400 billion rubles with maturities of three to ten years. First of all, the Ministry of Finance is counting on high demand from energy exporting companies, which have excess yuan in bank deposits received from the sale of oil and gas to China.