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Pimco stands to lose billions if Russia defaults on its debt

Section: Daily Dispatches

Joe Rennison and Brooke Masters
Financial Times, London
Wednesday, March 9, 2022

Pimco has billions of dollars riding on the economic fallout from Vladimir Putin’s invasion of Ukraine, after amassing a wager worth at least $1 billion in derivatives markets that the country will not default while also holding $1.5 billion of its sovereign debt.

The California-based asset manager started off the year exposed to $1.1 billion of credit default swaps on Russian debt. The derivative contracts are intended to compensate the holders in the event that the underlying bond issuer, in this case Russia, fails to make its payments.

... Dispatch continues below ...


Kinesis Money Launches the Referrer's Yield

Company Announcement
Thursday, December 23, 2021

LONDON -- Today, Kinesis Money, the monetary system based on 1:1 allocated gold and silver, launches its historic referrer's yield, paying physical gold and silver to all referrers. 

Going forward, all system participants whose referral activity contributed to the growth of the platform will be rewarded with a recurring, monthly yield.

Since the company's inception in 2019, more than 80,000 users have joined the Kinesis Money financial ecosystem, enabling the use of gold and silver as stable and spendable currencies.

As Kinesis Money broadens its global adoption, Kinesis users will continuously benefit from Kinesis' innovative yields system, earning monthly returns, proportional to the transactional volume and number of users joining the Kinesis community. ...

... For the remainder of the announcement:

At least five Pimco funds sold the CDS to investors, according to a Financial Times analysis of the asset manager’s holdings at the end of 2021. 

Pimco also holds more than $1.5 billion of government bonds tied to the Russian Federation, according to aggregated holdings data from Bloomberg.

Pimco sold the CDS to investors wanting protection against a potential default and collects premiums on the insurance-like product. In doing so, it effectively wagered that Russia would pay its creditors. The positions mean it stands to lose twice over -- first on its own bondholdings and then on the CDS payouts -- should Russia default. ...

... For the remainder of the report:

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