Puerto Rico would substantially reduce its core government debt load under a new deal announced on Tuesday, but obstacles remain for the U.S. territory’s exit from bankruptcy. The island’s federally created financial oversight board said its agreement with certain bondholders was a major step toward resolving the bankruptcy, which began in 2017 in an effort to restructure about $120 billion of debt and other liabilities, including unfunded pensions.
“I’m hopeful that people over time will understand this is likely to be the most fair and confirmable resolution to exit bankruptcy,” Natalie Jaresko, the board’s executive director, told reporters.
The deal will be included in a plan of adjustment the board expects to file in March in federal court, with the hope of court approval in the fall.
Author(s): Karen Pierog
Publication Date: 23 February 2021
Publication Site: Reuters