A federal stay barring Puerto Rico’s creditors from taking legal action against the commonwealth and most of its entities for nonpayment of debt expires on Tuesday, the Wall Street Journal reported yesterday. The stay was ordered under the Puerto Rico Oversight, Management and Economic Stability Act, or PROMESA, passed by Congress in June 2016.
Puerto Rico in Distress
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President Donald Trump said yesterday that he is opposed to a push to help Puerto Rico resolve its $70 billion debt load as the U.S. territory faces looming austerity measures amid a deep economic crisis, the New York Times reported yesterday.
An adviser to Puerto Rico Governor Ricardo Rossello said yesterday that the distressed U.S. territory would not necessarily file for bankruptcy if it failed to reach a debt-restructuring deal with creditors before Monday's negotiating deadline, Reuters reported yesterday.
Hedge funds first starting buying Puerto Rico debt in the summer of 2013 because they liked what they saw: A government that was paying high, tax-free yields that couldn’t go bankrupt.
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The Financial Oversight and Management Board for Puerto Rico was created under the Puerto Rico Oversight, Management and Economic Stability Act of 2016. The Board consists of seven members appointed by the President of the United States and one ex officio member designated by the Governor of Puerto Rico. Access information on the Board, documents, videos of meetings, calendar of events and live webcasts by clicking here.