Argentina plans bond swap to avoid US debts
Argentina has tried a new legal move in its efforts to avoid paying off US hedge funds that have acquired its debt and which are refusing to take part in a restructuring.
President Cristina Fernandez de Kirchner unveiled domestic legislation that would swap its existing bonds, which are covered by US law, for new notes governed by Argentine law.
“If bondholders decide in individual or collective form to ask for a change of legislation and jurisdiction of their bonds … the economy ministry is authorised to implement a swap for new public bonds under local legislation,” Ms Fernandez said. “This is an option bondholders have. It’s not an obligation because we can’t impose obligations on them according to our contracts. Our contractual obligation is to always guarantee that they can collect [interest].”
Argentina defaulted on its debt last month after a New York court prevented the country from paying interest to bondholders unless it first compensated the hedge-fund holdouts that are demanding repayment in full.
Some analysts warned even if bondholders accepted the swap offer the manoeuvre could carry legal risks. “Argentina could end up in contempt,” said Alejo Costa, a strategy chief at the Buenos Aires investment bank Puente, referring to the original US court order forbidding interest payment.
Axel Kicillof, the economy minister, also said yesterday that Argentina would make the next coupon, or interest, payment due on its bonds on 30 September, using an Argentine bank as a intermediary. Its last interest payment, of $539m (£324m), remains with the intermediary Bank of New York Mellon after the US court blocked the payment to investors.
- 1 Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
- 2 Sofyen Belamouadden murder: The inside story of a crime that horrified Britain
- 3 UK weather: Britain braced for snow as arctic air mass moves in
- 4 Aaron and Melissa Klein: Oregon anti-gay bakers ordered to pay $135,000 after refusing to make cake for same-sex wedding
- 5 'Isis' schoolgirls: Missing British teenager tweets picture of her Syrian takeaway
Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
Ian Brady: Moors murderer announces his support for Ukip and the SNP
Aaron and Melissa Klein: Oregon anti-gay bakers ordered to pay $135,000 after refusing to make cake for same-sex wedding
UK weather: Britain braced for snow as arctic air mass moves in
Power of Nepal earthquake was equivalent to 20 huge atomic bombs
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
The sickening truth about food banks that the Tories don't want you to know
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
General Election 2015: Britain would become a 'communist dictatorship' under Ed Miliband and Nicola Sturgeon, claims wife of Michael Gove
iJobs Money & Business
£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...
£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...
£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...
£45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...