Russia Skirts Nearer Default After Dollar Payment Blocked (1)

Russia slipped closer to a technical default after foreign banks declined to process about $650 million of dollar paymentson its bonds, forcing it to offer rubles instead.

While the finance ministry said that it “considers it fulfilled its obligations in full,” neither of the securities involved allowed payment in rubles, according to bond documents. Both notes have a 30-day grace period, data compiled by Bloomberg show.

The U.S. and the European Union imposed tough financial sanctions on Russia after President Vladimir Putin invaded Ukraine late February, hampering its ability to transfer payments to bondholders. Russia has so far sidestepped ...