Russian assets in Irish funds plunge from €13bn peak as crisis mounts

Irish-domiciled funds held almost €13 billion of Russian stocks and bonds as of last September, as the Moscow stock market peaked at a record high, according to Central Bank sources.

While Russian assets accounted for about 0.3 per cent of the €4 trillion-plus of assets in Ireland's international funds hub at the time, their value has plunged since last Thursday, as the country became an economic and financial markets pariah after invading Ukraine.

The Moscow Exchange has not opened so far this week and western markets have limited trading in Russian securities. However, London-listed Russian stocks and so-called exchange-traded funds (ETFs) that track the expected performance of Russian shares and bonds have continued to plummet in recent days.

Euronext Dublin

The so-called iShares MSCI Russia ETF that tracks Russian stocks has plunged by almost 50 per cent in less than a week and is 71 per cent down from last October, shortly after the Moscow market reached an all-time high.

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The prices of Russian government bonds have also spiralled lower, with the largest , a $7 billion bond that falls due in 2047 and which is technically listed on Euronext Dublin, currently trading at a little over 36 cents on the dollar, indicating the level of stress being priced in by the market.

Special purpose vehicles

Sources said the nearly €13 billion of Russian assets in Irish-based funds as of September, which had already declined to €11.4 billion by December, before the recent sell-off, were split roughly equally between bonds, primarily government debt, and shares in companies.

Meanwhile, a Central Bank review has found that three Irish special purpose vehicles (SPVs) are directly linked to individuals or financial institutions covered by EU February 23rd sanctions on Russia, the Taoisach has told the Dáil .

Dublin’s IFSC is home to about €36 billion of assets in Russian-linked SPVs used by companies to raise funding. They are part of the almost €1 trillion of global assets in about 3,000 Irish SPVs.

The review of links between Irish SPVs and Russian entities concluded that 34 of them were established on behalf of a Russian company, Micheál Martin said.