Cbonds Information Agency unveils new information on the Russian local bonds – covenant database. At the moment, more than 200 issues of the Russian bonds have covenants. We think that this information will be useful for the Cbonds website users at the time of making investment decisions and bond market analysis.
Information on covenants, subject to their availability, can be found on the issue page as a separate tab next to “Money flow” and “Credit ratings” tabs. The covenants types according to the local bonds of the Russian issuers are primarily correspond to the Eurobonds' covenants. Additional type “Others” include such covenants as: delisting of classic bonds, non-inclusion/exclusion from the Lombard list of the Central Bank of the Russian Federation, non-compliance with deadlines of financial reports’ disclosure and etc.
You can find the full list of the covenants in the corresponding Cbonds release
. As an example of implementation of this update, we offer JSCB Peresvet issue, BO-P05.
According to the internal Cbonds procedure, the covenant is an issuer's obligation arising in case of failure to fulfill pre-agreed conditions or occurrence of pre-agreed events. As the issuer’s obligations (hereinafter referred to as the “Obligations”) are understood:
- buyout with further possible conversion;
- early redemption;
- early conversion (for convertible securities).
Information about obligation type accepted by the issuer is in the “Money flow” tab of the issue page in the section “Early redemption provision”.
According to the internal Cbonds procedure, the covenants exclude absolute covenant of the issuer as stipulated by the current legislation and institutional market rules of the securities. These are the following rules of the early redemption:
- bonds delisting (only for stock issues);
- default (excluding cross-default);
- non-compliance with the law on mortgage-backed securities (for the mortgage bonds).
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