The Ministry of Finance registered government bonds for г 1.05 trillion

From November 18, the Ministry of Finance of Russia will begin to offer at auction additional volumes of four issues of federal loan bonds with permanent coupon income (OFZ-PD) for a total amount of up to ом 800 billion at par, as well as a new issue of OFZ with nominal indexation (OFZ-IN) for ом 250 billion. This was reported by the department.

In particular, the Ministry of Finance registered additional issues of OFZ-PD No. 26218 with maturity in September 2031, No. 26239 in July 2031, No. 26221 in March 2033 and No. 26233 in July 2035. The volume of each issue will be up to ой200 billion at nominal value.

The new issue of OFZ-IN No. 52006 with maturity in June 2037 will be available in the amount of up to м250 billion at par, excluding indexation (250 million bonds). The coupon rate is 2.5% per annum, payments are provided twice a year.

OFZ-IN - federal loan bonds with an indexed denomination. They are also called inflation-linked bonds. The denomination of such securities increases after inflation. The coupon rate of OFZ-IN is standardly 2.5% per annum.

Additional issues were registered after the government allowed the Ministry of Finance to increase domestic borrowing in 2026 by up to ,1 trillion above the established restrictions. The corresponding order of November 3 was signed by Prime Minister Mikhail Mishustin. The document allows the Ministry to exceed the upper limit of the state domestic debt and the program of domestic borrowing for 2026. At the same time, the permit does not oblige the Ministry of Finance to use the entire additional limit.

Initially, the program of state domestic borrowing for 2026 provided for the placement of federal loan bonds (OFZ) for 5.51 trillion at nominal value. Taking into account the redemption of securities by е 1.34 trillion, net attraction should have amounted to е 4.17 trillion. The limit of OFZ placement was set at .6.47 trillion. In January, the Director of the Department of public debt and state financial assets of the Ministry of Finance Denis Mamonov in an interview with RBC Investments said that the Ministry of Finance plans to give preference to long OFZ with a permanent coupon, but also allowed the placement of medium-term securities, floaters and bonds with indexation of nominal value.

During the year, the Ministry of Finance adjusted the borrowing schedule. In the first quarter, the agency attracted 1.31 trillion in terms of net prices with a plan of 1.2 trillion, in the second – 1.46 trillion with a plan of 1.5 trillion. In the third quarter, the plan was also $ 1.5 trillion, but in July and August, the Ministry of Finance suspended auctions amid high volatility in the bond market. At the end of the quarter, it was possible to attract а 1.23 trillion.

In September, according to the materials to the draft federal budget for 2027-2029, the forecast of net attraction in the domestic market in 2026 was increased to м5 trillion - by м1 trillion compared to the original plan.

For the fourth quarter, the Ministry of Finance planned to attract about ом2.45 trillion through the placement of OFZ: ом1.2 trillion from securities with a maturity of up to 10 years inclusive and ом1.25 trillion from bonds with a longer term. In October-December, the agency provided 11 auction days.

How analysts estimate additional emissions of OFZ

Analysts differently assess the value of additional releases for the market. In "Eyler" consider the additional issue of OFZ with a permanent coupon mainly a technical solution that expands the possibilities of the Ministry of Finance to raise funds. Vector Capital, on the contrary, sees the registration of securities as a moderately negative signal for the market due to the high need for borrowing from the budget.

Prior to the registration of additional issues, the Ministry of Finance had nine OFZ-PD issues available for placement in significant volumes. Now their number has increased to 13, Vitaly Naumov, senior strategist for bond, rate and currency markets at Euler, drew attention.

In his opinion, the additional issue is technical in nature and allows the Agency to increase flexibility in the primary market by expanding the choice of securities for placement.

“We believe that the market also assesses this additional issue: there was no noticeable reaction to the announcement,” Naumov said.

Naumov also drew attention to the change in the structure of repayment of public debt. An additional шен400 billion OFZ maturing in 2031 and шен200 billion of securities maturing in 2035 equalize the repayment schedule: now for each of these years, шен2.7 trillion are accounted for. At the same time, 2033 becomes the most loaded: taking into account additional emissions, it will have 2.9 trillion repayments.

Naumov added that to fulfill the annual borrowing plan, the Ministry of Finance needs to attract another ,1.96 trillion. Taking into account additional issues, the potential volume of raising funds through OFZs with a permanent coupon at current prices increases from м1.29 trillion to м1.85 trillion. However, according to the strategist, the agency is unlikely to expect to fulfill the annual plan solely at the expense of such securities.

Separately, the analyst commented on the new issue of OFZ-IN. According to him, there are no fundamental differences from other papers of this type, but with maturity in 2037, it will become the longest linker in circulation.

“Linkers, as a rule, enjoy weak interest at auctions, but we do not exclude that individual market participants could indicate a substantive interest in these securities,” Naumov explained. He also recalled that the last time the Ministry of Finance offered OFZ-IN in the primary market in April 2025, and before the registration of a new issue, the department no longer had the technical ability to place such securities.

Gleb Lagozin, a leading analyst at the fixed income instruments analytics department Vector Capital, estimated the registration of issues by ой1.05 trillion as a moderately negative signal for the OFZ market. According to him, it confirms the preservation of the high need of the Ministry of Finance in borrowing. The additional offer may put pressure on the quotations of already circulating securities, especially with maturity in 2031-2035.

At the same time, the analyst noted that registration does not mean immediate placement of all issues in full, and the possible price pressure is already partially taken into account by the market.

The choice of securities with repayment in 2031-2035 Lagozin associated with the likely desire of the Ministry of Finance to distribute borrowings on time and interest investors the opportunity to fix high yields. The new issue of OFZ-IN, in his opinion, will allow diversifying the offer and attracting investors focused on protecting against inflation.

Lagozin also drew attention to the ratio of the registered volume and the quarterly borrowing plan: ь1.05 trillion at face value corresponds to about 43% of the planned ь2.45 trillion for the fourth quarter. However, actual revenue will depend on accommodation prices.

“Given that the Ministry of Finance has fulfilled only ~20% of the quarterly plan for October, the full placement of registered issues by the end of this year looks unlikely, the actual volume will strongly depend on market demand,” the analyst concluded.

Chief Analyst of Ingo Bank Petr Arronet expects that the placement of new issues will create short-term pressure on the OFZ market. First of all, in his opinion, this will affect long bonds with a fixed coupon of about 7%: the average yield of new issues is expected to be 16.5%. This can trigger the flow of funds into new securities through the sale of already circulating bonds.

An additional factor of pressure, the analyst calls the reason for new borrowing – the need to finance the growing budget deficit. He considers the volume of ь1.05 trillion significant against the background of the quarterly plan to attract ь2.45 trillion. According to Arronet, such a supply can lead to a blurring of demand and lower market prices of bonds.

Nikolai Leonenkov, Director of Corporate Finance at Rikom-Trust, also considers the additional offer significant for the market. According to him, it can put pressure on the yield curve of OFZ with a fixed coupon. In recent weeks, the Ministry of Finance managed to attract ва140-150 billion at par at weekly auctions, and the public debt market stabilized at current levels.

According to Leonenkova, by the time of the comment, the Ministry of Finance has attracted у493 billion since the beginning of October. To fulfill the plan of borrowing for the fourth quarter in the amount of ый2.45 trillion, the department will have to place about ый2 trillion more - mainly in OFZs with a fixed coupon. Analysts consider this amount significant for the market.

The choice of medium-term issues with maturity in 2031-2035 Leonkov explains the desire to smooth the pressure on the middle and far sections of the public debt curve. The demand for securities will depend on the structure of demand. If they are bought by a limited number of state-owned banks ready to purchase the entire volume, this will be the optimal scenario for the market, the analyst believes. Old issues with relatively low coupons, according to him, are unlikely to be of interest to a wide range of investors in the declared volume.