Russia's Ministry of Finance said on Friday that it had made the payments in dollars after originally attempting to use rubles to clear the debts, potentially staving off what could have been the country's first default on its foreign debt since the Russian Revolution in 1917.
The two payments, originally due on April 4, were sent before the end of a 30-day grace period to the London branch of Citigroup, the paying agent for distributing the payment to holders of the Eurobonds.
"The Ministry of Finance has the resources and so, from the economic point of view, there can be no talk of a default," said Elvira Nabiullina, governor of the Russian central bank. "But, there are complications in payments which we are seeing, and I hope that all of this also is resolved successfully."
An international debt committee ruled in April that Russia's original payment in rubles constituted a "Potential Failure To Pay" event, which meant it would have automatically defaulted on Wednesday if the payment had not gone through.
Russia's first attempted payment on the bonds was blocked by a U.S. correspondent bank at the beginning of April, forcing it to turn to its National Settlement Depository to fulfill its obligations.
The payment, if processed before the grace period expires on May 4, also will save bondholders, who could be unable to collect what they are owed as Russia did not waive its sovereign immunity in the bonds.
The Central Bank of Russia tightened capital controls in March to limit domestic access to foreign currencies, causing ratings agencies to warn of an imminent default on the government's external debt.
Russia's state railway company RZD OAO became the first company to default on debt instruments since the beginning of the invasion of Ukraine, after it failed to make payments on Swiss franc notes due in March.
The Financial Conduct Authority began a consultation in late April on proposed regulation changes that would allow fund managers to split sanctioned Russian investments from their core investments, freeing some funds up to trade again after some shut down trading.
--Additional reporting by Caroline Simson and Najiyya Budaly. Editing by Joe Millis.
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