ZCZC
BCN-26
US-PUERTORICO-DEBT-BONDS
Puerto Rico bondholders agree to debt restructure plan
MIAMI, Aug 9, 2018 (BSS/AFP) – Puerto Rico’s governor announced Wednesday
the island’s Washington-established financial oversight board had struck an
debt restructuring deal with bondholders that would save $17.5 billion in
future payments.
Ricardo Rossello’s announcement came hours after his government presented
to Congress a $139 billion development and recovery program following last
year’s hurricanes, which devastated the US territory.
In a statement, Rossello’s office said the oversight board had agreed with
a significant number of bondholders — “in principle” — to restructure
Puerto Rico Sales Tax Financing Corporation (COFINA) debt “to terms that are
aligned with the fiscal reality of Puerto Rico.”
The agreement would save Puerto Rico $17.5 billion in payments to
bondholders.
“This agreement represents a significant step in restructuring Puerto
Rico’s debt and reaffirms once again the credibility of our efforts,” said
Rossello, quoted in the statement.
The most recent operational report from the Puerto Rican government, dated
December 2016, said that COFINA had issued all of its $17.3 billion in bonds
between 2007 and 2011.
Soon after, in May 2017, Puerto Rico declared itself bankrupt, with public
debt surpassing $70 billion.
Four months later, hurricanes Irma and Maria ruined the island’s
infrastructure, above all its electricity, plunging Puerto Rico into crisis.
On Wednesday, the Puerto Rican government asked Congress to allocate
funding to the tune of $139 billion for reconstruction efforts, including
rebuilding homes, water and energy systems, and rehabilitating services such
as health, education and transport.
“All of the initiatives aim to make us stronger and more resilient, while
guaranteeing long-term economic recovery,” said the governor.
BSS/AFP/HR/1048