NEW YORK (AP) — A judge says Citibank can process Argentina’s interest payments to a small subset of bondholders this month as a broader debt fight continues.
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The Wall Street Journal (http://on.wsj.com/1pxhxc5 ) says U.S. District Judge Thomas Griesa agreed Friday Citibank could process roughly $5 million due Sept. 30. The decision concerns only certain dollar-denominated bonds issued under Argentina’s laws.
Argentina defaulted on its national debt in 2001. Most bondholders accepted lower-value bonds in exchange for the defaulted debt. But some U.S. hedge funds held out for full repayment.
Griesa ruled earlier this year that Argentina had to settle with the holdouts before paying the other creditors. Argentina then couldn’t pay $539 million in interest due July 30, triggering another default.
Argentina is moving toward paying bondholders locally to dodge the U.S. financial system.
