Evraz's foreign bond payment goes through, after bank nerves about Roman Abramovich hold up the cash

• Russian steelmaker Evraz said its bond payment had successfully reached its paying agent, following a delay.
• The company believes the payment was held up because of sanctions on its biggest shareholder, oligarch Roman Abramovich.

Russian steelmaker Evraz has said the money for one of its bond coupons has reached its paying agent, after being held up due to concerns about sanctions on the oligarch Roman Abramovich, who is the company's biggest shareholder.

The company said Monday its $18.9 million coupon payment, due March 21, on a $705 million note maturing next year had been held up by Societe Generale, its foreign correspondent bank.

It said it believed the hold up was because of UK government sanctions on Abramovich, who owns 28.6% of the company.

However, the payment eventually worked its way through on Tuesday evening to BNY Mellon, which is responsible for getting the money to bondholders, according to a statement from Evraz.

BNY Mellon did not respond to a request for comment about whether bondholders had yet received the money.

However, the delay is a clear sign of the financial difficulties faced by Russian companies and the investors who lent them money as a result of the conflict in Ukraine.

Western banks have been highly cautious about dealing with Russian companies after the US and its allies slapped tough sanctions on the country.

JPMorgan, for instance, has sought approval from the US authorities before processing payments on Russian government bonds, according to a person familiar with the matter. JPMorgan has declined to comment on the situation.

A separate Russian steelmaker, Severstal, could default on its debt on Wednesday after its paying agent Citigroup requested that the company get permission from the US Office of Foreign Assets control. A $12.6 million payment was due on March 16, and has a five business-day grace period that ends Wednesday.

Credit rating agency Fitch earlier this month slashed the credit ratings of numerous Russia commodities companies into "junk" territory, including Evraz and Severstal.

It said that "default of some kind appears probable" due to sanctions that have made it much more difficult for Russian companies to access global financial markets.

Despite Fitch's concern, Evraz said it is fully committed to fulfilling its upcoming payment obligation on April 4 for a $700 million bond that matures in 2024.

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