DEBT CRISIS OF MONDAY 18 JANUARY 2016
They believe that the government's offer to holdouts would remove a maximum of 30%
By Leandro Gabin firstname.lastname@example.org
Thus it emerges from a report by JPMorgan for customers who agreed Infobae. They say they will touch the interests of the defaulted bonds. They add that accelerate an agreement would increase confidence in the country
Alfonso Prat Gay and Luis Caputo Argentine officials are in charge of the negociaciónAlfonso Prat Gay and Luis Caputo Argentine officials are in charge of the negociaciónCrédito: Adrian Escandar are beginning to shuffle several scenarios for negotiations between Argentina and the holdouts. While economic team led by Alfonso Prat Gay and creditors submitted formal proposals during the week of January 25, in the financial market and see a sung outcome: the country can not offer a bargain too hard in terms of removing. They could try to "sweeten" internally arrangement if they ask bondholders to put new money in addition to swap their bonds by more term bonds. That was his idea, for example, the lawyer Eugenio Bruno, who was next to Luis Caputo The Secretary of Finances last week to leave the court mediator Daniel Pollack in New York.
What could submit Prat Gay Elliott and company? According to a report to clients of JPMorgan, which agreed this means the Treasury mean that could be applied to the amount claimed by the holdouts would be 20% or 30% on interest. It is worth remembering that the USD 9,800 millions in litigation, 70% corresponds to the interest and penalties and only 30% of the capital of the bonds. Therefore, Prat Gay and Caputo know that 30% is untouchable. If no pruning may be on interest.
"Ultimately, advancing with a rapid agreement with creditors who did not accept the swap will strengthen market confidence and credibility of the new government, strengthening the government's ability to implement plans to combat inflation and fiscal consolidation, while growing access to financing, "wrote JPMorgan.
For the investment bank, "the first official meeting between creditors and the Argentine government in New York supports our view that the negotiations are moving smoothly in the right direction."
The formal offer would, then, long-term bonds to redeem these bonds in default, with a rebate of 30% on interest, capital credit 100%, and tempt them with new bonds to subscribe new financing (or $ Fresh constants hard cash).
The mediator Daniel Pollak. <br>
The mediator Daniel Pollak.
Anyway Prat Gay and warned that negotiations take time. Presumably, Argentina is in a position of weakness. Holdouts know that the need to fix that has the government Mauricio Macri is high. Of course, not collide with teenage intransigence Kirchner, headed by Axel Kicillof, who kicked the door to any overture.
With capacity to carry out an arrangement at the height of the circumstances, this team will have to overcome economic needs. It is expected that the agreement with the pool of international banks this week is finally announced. It would be for between USD 6,000 million and USD 8,000 million. This will give greater financial back to the country to negotiate with the holdouts, who know the local emergency: without closing the trial of the century, there will be fluid dollar funding from abroad.
For now, and while it is kept everything very secrecy, Caputo had positive meetings with the holdouts who were last week Pollack's office. It is said that bondholders were represented something like USD 8,000 million of debt, ie the vast majority (who won the trial as Elliott and Aurelius and called me too)