BUENOS AIRES: Argentina announced it was sending a delegation to New York to meet with a coordinator picked by the US judge in its hedge funds debt case.
The Economy Ministry delegation will meet on July 7 with Daniel Pollack, a government statement said. US District Judge Thomas Griesa on Friday barred the Bank of New York Mellon from transferring $539m in Argentine funds to the country’s main creditors, the so-called exchange bondholders, unless Argentina also pays hedge funds. That meant the country could likely be technically in default on Monday. But a one-month payment grace period gives Buenos Aires until the end of July to negotiate a deal with both groups of lenders before being called into default on its debt for the second time in 13 years.Argentina insisted that it had fulfilled its obligations last week, when it deposited the funds in the BNY Mellon account.
President Cristina Kirchner’s chief of staff Jorge Capitanich said Buenos Aires could not be considered in default if the bank did not forward the money to the exchange bondholders, creditors who joined the 2005 and 2010 restructurings of the country’s $100bn in defaulted debt.
Griesa, whose original 2012 ruling in support of hedge funds NML Capital and Aurelius Management was supported two weeks ago by the US Supreme Court, pressed Buenos Aires on Friday to negotiate a payment deal with the two funds. He ordered Argentina to pay $1.33bn.
Argentina has argued that paying the full worth of the bonds held by the hedge funds is unfair to the 92 percent of creditors who joined the restructuring taking a huge 70 percent writeoff.
Secondly, the country says being forced to pay the “holdouts” would overwhelm its weak finances and force it into default.AFP
