Argentina to try to end default with bond change
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Argentina to try to end default with bond change

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.

Associated Press