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Montevideo, December 11th 2016 - 13:44 UTC

Argentina reiterates it will use all legal means to defend position against US court ruling

Tuesday, November 6th 2012 - 20:04 UTC
Full article 24 comments
Economy minister Lorenzino: ‘vulture funds’ won’t prevent Argentina from honouring commitment to bondholders who agreed to debt restructuring Economy minister Lorenzino: ‘vulture funds’ won’t prevent Argentina from honouring commitment to bondholders who agreed to debt restructuring

Argentina will use all legal means to defend its position against a US court ruling that would force the country to repay creditors who sued to collect on defaulted Argentine bonds, Economy Minister Hernan Lorenzino reiterated in Mexico.

Late last month, a federal appeals court in New York ruled that Argentina violated bond provisions to treat all creditors equally when it made payments to creditors who accepted the swaps, while refusing to pay the holdouts, estimated in several billion dollars and which Argentine president describes as ‘vulture funds’.

Lorenzino said Argentina would honour debt payments to bond holders who agreed to the restructuring. He added that the funds for the December payments are already deposited at the Argentine central bank.

”We will use all (legal) avenues to continue defending Argentina's position before the courts,“ Lorenzino told reporters on the sidelines of the G20 meeting of finance chiefs in Mexico City.

”We will not allow the actions of ‘vulture funds’ to prevent Argentina from honouring its commitments to bondholders who agreed to the debt restructuring.“

Fitch has put Argentina's foreign currency ratings on watch negative, stating the ruling ”increased uncertainty about Argentina's ability to service its international securities issued under New York law on a timely basis using the US financial system”.

In the ruling Circuit Judge Barrington Parker said that “nothing in the record supports Argentina's blanket assertion that the injunctions will plunge the Republic into a new financial and economic crisis”, thus agreeing with Judge Griesa that with more than 40 billion dollars in foreign reserves, Argentina has the ability to pay the holdouts.

“We hold that Argentina breached its promise,” the appellate court said, summarizing a 29-page ruling that could make it difficult for Argentina to use the US financial system unless it complies.

Griesa said any financial institution that processes Argentina's payments to the holders of restructured bonds must ensure that the holdouts are paid an equal amount to avoid violating the court's order. Effectively, this would force US banks to stop the payments unless Argentina proves it's complying with the ruling.

The appeals court sent the case back to Griesa’s court to clarify how a payment formula set by the judge is intended to work and to determine how the orders apply to intermediary banks and other third parties.
 

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  • briton

    Argentina reiterates it will use all legal means to defend position ??

    Well that ends their chances then,
    And this bloggy.lol.
    .

    Nov 06th, 2012 - 08:35 pm 0
  • Pirate Love

    huff and puff, but your debt will be paid one way or another.

    Nov 06th, 2012 - 09:01 pm 0
  • toooldtodieyoung

    “Argentina reiterates it will use all legal means to defend position against US court ruling”

    What position?

    The bend-over-and-take-it-without-crying-like-a-b*tch position?

    Argentina hasn't got a defendable position on this. They borrowed money, the people they borrowed it from what it back, they have to pay up...........................end of.

    Nov 06th, 2012 - 09:13 pm 0
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