Argentina’s government plans to change the way it pays holders of the country’s debt as a way to end the default triggered by a legal battle with U.S. investors.
President Cristina Fernández de Kirchner says she will send a bill to Congress that would set up a system to pay bondholders in Argentina instead of channeling them through the Bank of New York.
The change is intended as a way around a U.S. court order that blocked Argentina from making $539 million in interest payments on July 30, triggering the country’s second default in 13 years. It would affect creditors who accepted lower-value bonds following the country’s 2001 default and could further complicate the battle with holdout creditors.
Kirchner proposed the change, which is expected to pass Argentina’s Congress, late Tuesday.