Argentina offers to pay debts with cash & bonds

March 29, 2013 • Business

FILE – In this Aug. 2, 2012 file photo, Argentina’s President Cristina Fernandez speaks at an event marking the 158 anniversary of the stock exchange in Buenos Aires, Argentina. The South American country has until midnight Friday, March 29, 2013 to propose how it would satisfy a $1.4 billion judgment won by plaintiffs in U.S. courts who have insisted [auth] for a decade on getting full payment in cash, plus interest and penalties, on sovereign debt that the country hasn’t paid since its world-record default in 2002. Fernandez’s government is reportedly preparing a response that analysts say could lead the country into another catastrophic default. (AP Photo/Eduardo Di Baia, File)

BUENOS AIRES, Argentina (AP) — Argentina is offering a creative way out of its debt showdown in a U.S. appellate court.

Its proposed payment plan for $1.44 billion in debts left unpaid since the country’s 2001 default is a mix of cash and new bonds that it says would provide the plaintiffs with a huge profit, but not a gargantuan one.

According to the math Argentina gave the appellate judges just before a midnight New York deadline, NML Capital Ltd. would eventually make an aggregate profit of a 284 percent on the bonds it bought five years ago, but not an unfair gain of 1,380 percent.

Argentina is appealing a ruling that would make it pay it all in cash up front.

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