A lot of people in muniland have asked me how much the bonds of Puerto Rico’s electric monopoly Prepa will recover if they are restructured. I’ve thrown out a few numbers, but I don’t have an analytical tool to do a proper cash flow analysis. Chris Foster, managing director of New Oak, has published an open source model (download middle right of page – XLSM file) that allows one to adjust various inputs like fuel prices and electric rates to estimate the level of debt service that Prepa can support.
Puerto Rico agencies showered with credit downgrades
Moody’s Analytics: PR’s risk is highest of all 84 sovereign entities we track
Puerto Rico House and Senate pass balanced 2015 $ 9.56 billion budget
Puerto Rico’s May Economic Activity Index declines 1.1 percent year over year
Treasury Melba Acosta Febo signals Puerto Rico’s intent to restructure
Prepa is in dire dire straits – language from PR’s financial filings
Crunch time: Waiting for Prepa to make its $204 interest payment due July 1
Puerto Rico finally publishes their fiscal year 2013 financials
Nuveen on Prepa default signalling more general defaults
Creole Bankruptcy and energy reform are pieces of the same puzzle
Northern Mariana Islands bankruptcy filing may be Puerto Rico template
Senate President signs legislation to pay interest on general obligation bonds
Prepa bonds hit hard
Bellweather Puerto Rico general obligation bonds weakening
The news flow from Puerto Rico has become a whirling inferno since the government passed legislation last week to allow some of the Commonwealth’s public corporations to default.
Puerto Rico’s faltering electricity monopoly PREPA received another blow this week when Standard & Poor’s downgraded the public corporation’s $8.8 billion of revenue debt to BBB- (5.5) from BBB (6) and placed the rating on CreditWatch with negative implications. This leaves PREPA one small step from junk grade in the three major raters.