Wednesday, August 6, 2014

Judge Griesa orders BoNY to retain bondholder payment

File photo of NY judge Thomas Griesa.

New York district judge Thomas Griesa has ordered Bank of New York Mellon to retain the funds deposited by Argentina to pay exchange bondholders, while declaring the payment “illegal.”

“BNY shall retain the funds in its accounts at the BCRA pending further order from this court and shall not allow or make any transfers of the funds unless ordered by court,” a statement signed by Griesa reads.

The NY judge described the payment as “illegal”, as it does not follow his ruling on the so called “vulture fund” case, where he sentenced Argentina shall pay exchange bondholders and holdouts altogether.

Today, Argentina formally demanded BoNY, as well as Citibank, to unblock the funds issued to exchange bondholders, and BoNY responded it will not make any transfer as it will respect Griesa’s ruling.