Wednesday, August 20, 2014

Cristina Fernández de Kirchner announces plan to remove BONY as agent, pay bondholders in Buenos Aires

President Cristina Fernández de Kirchner has announced that a new law to be debated in Congress will seek to remove the Bank of New York (BONY) as the agent through which restructured bondholders receive payments, clearing the way for those creditors as well as holdouts to be paid in Buenos Aires.
Speaking via national broadcast today, the head of state unveiled the Sovereign Payment Law, which if passed will declare the 2005 and 2010 debt swaps as of public interest, thus allowing 100 percent of bondholders to receive payment.

The move follows the ruling of New York judge Thomas Griesa to prohibit the BONY from passing on to creditors interest services deposited by Argentina. Holdout investors led by NML Capital and Aurelius won a judgement that states that holders of restructured debt cannot receive payments until a settlement is reached with the so-called 'Vulture funds'.
During her address, CFK affirmed that "The Convertibility Law put the country fiercely in debt," suggesting that the policy of pegging the peso to the dollar led to what she termed "the default and institutional breakdown of 2001." 
"Every Argentine knows that this government did not take out this debt," the president fired.

Cristina also emphasised that this move was provoked by the refusal of the vultures to reach a compromise with Argentina over the bonds purchased following the default of 2001.
"We tried to negotiate with the vulture funds, but they do not negotiate," she explained, before slamming the conduct of Griesa in blocking payment to creditors.
"Griesa seized money that was no longer Argentina's".

Under the proposed law, bonds currently held under New York jurisdiction would be moved to Argentina. A trust fund under the guardianship of the Banco Nación would take responsibility for paying creditors, and not the BONY.

Cristina added that an account would be opened in the Central Bank, reopening the 2010 restructuring for the 7 percent of creditors who did not participate in debt swaps.
"We're going to open a Central Bank account to deposit the 7.6% (holdouts) what they're owed as if they had accepted the swap," she underlined.
 http://www.buenosairesherald.com/article/167517/cfk-announces-plan-to-remove-bony-as-agent-pay-bondholders-in-buenos-aires
19/8/14
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2 comments:

  1. Dette : Buenos Aires propose à ses créanciers de les rembourser en Argentine...

    La présidente Cristina Kirchner a annoncé mardi 19 août que l'Argentine allait désormais rembourser sa dette sur la place financière de Buenos Aires, afin de contourner le blocage par la justice américaine d'échéances de la dette.

    « Pour sauvegarder le versement aux créanciers qui ont accepté les restructurations de dette de 2005 et 2010, [la banque publique] Banco Nacion a été désignée en remplacement de Bank of New York Mellon, sans préjuger de ce que décideront les détenteurs de bons. C'est une mesure basée sur le volontariat. »

    Elle a précisé qu'un projet de loi en ce sens avait été envoyé au Congrès.

    539 MILLIONS DE DOLLARS BLOQUÉS À LA BANK OF NEW YORK

    Le dernier remboursement de dette argentine aux créanciers privés, 539 millions de dollars (405 millions d'euros), est bloqué depuis le 26 juin sur un compte de Bank of New York, sur décision d'un juge américain. L'Argentine a en effet été condamnée par la justice américaine à verser 1,3 milliard de dollars (976 millions d'euros) à des fonds « vautours » détenant moins de 1 % de la dette mais elle s'y refuse, avançant que l'application du jugement ferait s'écrouler la restructuration de la dette acceptée par 93 % des créanciers......................http://www.lemonde.fr/ameriques/article/2014/08/20/buenos-aires-propose-a-ses-creanciers-de-les-rembourser-en-argentine_4473650_3222.html#xtor=RSS-3208
    20/8/14

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  2. Italian bondholders praise jurisdiction change...

    The Italian bondholders' legal representative Tullio Zembo praised the Sovereign Public Debt Payment Law pushed by the government saying the decision to change the debt’s jurisdiction to Buenos Aires is “probably the most appropiate.”

    Zembo said that the government's proposal to remove bank of New York Mellon (BoNY) as payment agent “should be accepted” in order to “guarantee payment in time and manner, as it has been so far.” The Italian lawyer said this decision was “inevitable” because “no other solution was available.”

    “I would tell bondholders to receive payment,” Zembo said and called on exchange creditors to agree on the voluntary change of jurisdiction proposed by Argentina to “end (the dispute) once and for all” .

    “I care about the money reaching bondholders’ pockets,” he stressed.

    Zembo highlighted “Argentina’s willingness to pay,” challenged by US Judge Thomas Griesa’s order to block the deposits made by the government at the Bank of New York Mellon.
    http://www.buenosairesherald.com/article/167582/italian-bondholders-praise-jurisdiction-change
    20/8/14

    ReplyDelete

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