Alaska sees a swift drop in the value of its Russian investments and looks to sell

The value of investments in Russia held by the State of Alaska, including the permanent fund, has declined steeply since Russia invaded Ukraine, the state’s top revenue official said Tuesday.

Revenue Commissioner Lucinda Mahoney said the value of state-held Russian stocks, bonds and other investments has declined from $267 million at the end of last year to a current estimate of no more than $15 million.

The Russian stock market has been closed since the invasion. But Mahoney said the state plans to sell its Russian assets when it can.

“We believe that the financial conditions in Russia have and will continue to deteriorate, such that it makes it prudent to sell these securities and bonds,” she said at a news conference.

Gov. Mike Dunleavy and Mahoney said the permanent fund corporation will have to make its own decisions about selling its Russian assets. The Russian investments were less than three-tenths of 1% of the state’s assets before their value fell.

Dunleavy repeated his call last week for a series of steps aimed at punishing Russia. He also continued to criticize the Biden Administration for its handling of several proposed oil, gas and mining projects.

“Really, it’s nothing short of an attempt to snuff out the life of Alaska as a state,” he said. “And when we need these resources more now than ever, they’re doubling down on this stuff. It makes no sense at all.”

Both the governor and the revenue commissioner expressed frustration with banks that will not support drilling for oil and gas in the Arctic but continue to invest in Russia.

Dunleavy also called on the Legislature to quickly pass permanent fund dividend payments to help Alaskans deal with inflation. He said he expects the state will announce next week that its projected revenues are now billions of dollars more than projected spending.

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