Russia’s largest gold mining company PJSC Polyus completed the issuance of 4.6 billion yuan worth of Chinese yuan-denominated bonds. The issue, which has a maturity of five years, was released on the Moscow Stock Exchange with a coupon of 3.8 percent, Radio China reports.
The underwriter of the bonds was Gazprombank, according to the Chinese financial publication Caixin. From the issue documents, it is clear that banks are 71% of the buyers, investment companies – 15%, individual investors – 13%, and asset management companies – 1%.
Gazprombank announced that no threshold has been set for individual investors and the unit amount is only 1,000 yuan.
PJSC Polyus is the second Russian aluminum mining and processing company after Rusal to issue such a large yuan-denominated bond issue in just one month. Earlier, Rusal issued bonds worth 4 billion yuan.
According to Zhang Hong, a research fellow at the Institute of Russian, East European and Central Asian Studies at the Chinese Academy of Social Sciences, the economic sanctions imposed by the US and its European allies on Moscow have closed the door to Russian financing from the European and US markets and Russian companies. urgently need new investment channels. China’s economic development is steady, its market size is huge and continues to grow, which can satisfy Russia’s capital needs.
International demand for the yuan has shown an upward trend since the beginning of this year amid global geopolitical and economic changes. Russian firms and banks were involved in nearly 4 percent of international yuan payments by value in July. That was an increase of 1.42 percent from the previous month and zero in February, when the conflict between Russia and Ukraine began, according to a report by the Society for Global Financial Reporting (SWIFT). The yuan maintained its position as the fifth most active global payments currency by value in July, signaling a steady pace of its internationalization. At the same time, Russia has become the third largest market using yuan for global payments.