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Moscow has been seeking additional sources of funding to make up
for a budget shortfall caused by lower oil prices and the
coronavirus pandemic. Russia plans to increase its public debt
to nearly 19% of gross domestic product this year.
The country is placing a seven-year euro-denominated Eurobond,
setting its yield guidance at around 1.125%, the sources said.
The guidance had initially been set at 1.25%.
Russia's second tranche, a 12-year Eurobond also denominated in
euros, has a revised yield guidance of 1.875% after sources
initially said it would be around 2%.
Demand for the Eurobonds exceeded 2.2 billion euros, one of the
sources said, with the main interest coming from domestic
investors.
Russia last tapped the global debt market in 2019, when it made
two Eurobond placements in which it raised $5.5 billion and
another 750 million euros.
Its previous plans to raise $3 billion in Eurobonds this year
were thwarted by the COVID-19 pandemic and by increased risks of
Western sanctions, prompting Moscow to focus on borrowing at
home instead.
The finance ministry said on Tuesday it had picked VTB Capital,
Gazprombank and Sberbank CIB as organisers of a sovereign
Eurobond issue this year.
VTB Capital, which has acted as sole lead manager for Russian
Eurobonds in the past, had said that making a Eurobond placement
in November seemed more attractive than doing so in December.
(Additional reporting by Anton Kolodyazhnyy; writing by
Alexander Marrow and Gabrielle Tétrault-Farber; editing by Katya
Golubkova, Larry King)
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