Russian loans rocked: UK banks flee Rosneft-linked deal as sanction fears loom

By Michael Turner
05 Jun 2014

A loan of around $2bn linked to Russian state owned oil firm Rosneft suffered a double blow this week when half of the mandated lead arranger group fled the deal. Both HSBC and Lloyds dropped out showing that although Russian bonds may be about to enjoy a comeback, the crisis in Ukraine is keeping the Russian loan market under pressure, writes Michael Turner.

A special purpose vehicle linked to Rosneft and BP is the borrower of the loan, which will finance the pre-payment of BP oil purchases from Rosneft. Many in the loan market see the deal as Russian risk, though Rosneft has always denied it is raising a loan.

HSBC ...

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