Default avoided - for now: Russia reportedly made debt payment to JPMorgan

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JPMorgan Chase has received a debt payment from the Central Bank of Russia, a source familiar with the matter said Thursday, lessening concerns about an imminent Russian debt default.

JPMorgan, a corresponding or intermediary bank, sent the funds to Citigroup, the agent in charge of paying bond holders, after checking with US authorities, according to the person, who did not specify the amount received.

Both JPMorgan and Citigroup declined AFP's requests for comment.

The Russian finance ministry had earlier Thursday announced a completed interest payment to foreign debt holders, amid worries the unprecedented sanctions Western nations imposed on Moscow over its invasion of Ukraine could affect debt payments.

The country risked its first foreign debt default in more than a century if it had missed the payment on two-dollar denominated bonds. An interest payment of $117 million was due March 16.

The finance ministry said in a statement that a payment order worth $117.2 million "was executed" after it was sent to a bank on Monday.

Western sanctions have crippled the Russian banking sector and financial system, and precipitated a collapse of the ruble.

There had been concerns that the sanctions would prevent Moscow from accessing dollars to make its payments, causing a default if it used rubles instead.

Russia's government said Thursday that the payment was made in a foreign currency, without specifying which.

"There are no issues with servicing the state debt," the cabinet said on Telegram.

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