By Megan Davies and Jessica DiNapoli
(Reuters) – Puerto Rico will miss a payment on debt due Aug.
1, the governor’s chief of staff said on Friday, an event that
will be considered a default by investors as the commonwealth
lurches towards what could be one of the largest U.S. municipal
debt restructurings in history.
The island faces a number of debt payments that day but had
signaled in recent weeks that it may miss the $58 million
payment on Public Finance Corporation (PFC) bonds.
NEW YORK, July 31 (Reuters) – Puerto Rico’s expected default
on debt due Saturday would be the start to what could end up
becoming one of the largest municipal restructurings, with the
potential to open the door to a fight with investors and spark
volatility in bond prices.
Puerto Rico Governor Alejandro Garcia Padilla shocked
investors in June when he said the island’s debt – totaling $72
billion – was unpayable and required restructuring.
By Megan Davies
(Reuters) – Puerto Rico is working on ways to increase
liquidity at its Government Development Bank (GDB) to make a
debt service payment due Aug. 1, the governor’s chief of staff
said on Friday.
The GDB, which has reported dwindling cash reserves, faces
$169.6 million in debt service on notes on Aug. 1.
NEW YORK July 23 (Reuters) – Bondholders of Puerto Rico’s
debt-laden public utility PREPA offered to refinance their $8
billion in debt by splitting it into two classes of bonds, a
move they say would save PREPA $2.5 billion in financing costs
through 2025, according to an outline of the proposal made
public by the bondholders on Thursday.
The plan, presented to PREPA on July 7, is the latest salvo
in ongoing restructuring talks between the power utility and
creditors who hold about $9 billion in total debt, and counters
a June proposal from PREPA that was met with resistance from
NEW YORK (Reuters) – U.S. charter schools are defaulting on bonds at a rate of 3.3 percent, a level higher than that recorded three years ago but still not one which should concern investors, according to the co-publisher of a report made available on Tuesday.
Charter schools, held in a number of municipal bond funds, are public schools that operate independently and are an alternative to schools run by local school districts. They are publicly funded but use private-sector lenders to fund buildings.
NEW YORK, July 15 (Reuters) – Puerto Rico’s Public Finance
Corporation (PFC) failed to transfer funds to pay the principal
and interest on its bonds, according to the island’s bank and a
filing on Wednesday, highlighting cash problems as the island
tries to restructure its debt.
The transfer of $93.7 million was for a debt service payment
due Aug. 1 by PFC, part of the island’s Government Development
NEW YORK (Reuters) – Puerto Rico pleaded with creditors on
Monday not to engage in lengthy litigation over its $72 billion
debt, but provided little information about how a debt
restructuring would affect them.
At a packed meeting with bondholders at Citibank’s New York
offices, a clutch of the island’s top officials and advisors
again painted a bleak picture for the U.S. territory’s economy
and said fixing it would require pain to be shared by everyone
with a stake in its future.
NEW YORK (Reuters) – The head of Puerto Rico’s government bank told creditors on Monday that a plan to turn around the island would require all stakeholders to make sacrifices and that a “contentious drawn-out” process would only hurt the commonwealth.
A working group created by Puerto Rico Governor Alejandro Garcia Padilla met creditors at Citibank’s offices on Monday, which an estimated 350 people were set to attend. The working group includes officials such as Victor Suarez, chief of staff in the governor’s office and Government Development Bank (GDB) head Melba Acosta.
NEW YORK, July 13 (Reuters) – Investors in Puerto Rico hope
to get specific information about how the commonwealth plans to
restructure debt when government officials meet with creditors
on Monday, but there are fears that any bungled messaging could
knock bond prices.
Puerto Rico Governor Alejandro Garcia Padilla dropped a
bombshell on holders of its $72 billion debt on Jun 29, saying
he wants to restructure debt and postpone bond payments.
NEW YORK (Reuters) – Puerto Rico has hired Citi as a
broker-dealer as the island seeks to restructure its debt, an
industry source said on Wednesday.
The bank will host a meeting with creditors in New York on
Monday, Melba Acosta, head of the island’s Government
Development Bank, said on Tuesday. That will be the first
meeting with creditors since Governor Alejandro Garcia Padilla
said a week ago that he wants to restructure its $72 billion