Puerto Rico exits bankruptcy after grueling debt negotiation
ABC News
Puerto Rico’s government is formally exiting bankruptcy after completing the largest public debt restructuring in U.S. history after announcing nearly seven years ago that it was unable to pay its more than $70 billion debt
SAN JUAN, Puerto Rico -- Puerto Rico’s government formally exited bankruptcy Tuesday, completing the largest public debt restructuring in U.S. history after announcing nearly seven years ago that it was unable to pay its more than $70 billion debt.
The exit means that the U.S. Caribbean territory’s government will resume billion-dollar payments to bondholders for the first time in several years, settle some $1 billion worth of claims filed by residents and local businesses and issue more than $10 billion worth of bonds. The government also will restore up to $1.3 billion taken from a public pension system.
“This is a significant success,” said Natalie Jaresko, executive director of the federal control board that oversees Puerto Rico’s finances and its debt restructuring process. “Remaining in bankruptcy has been a drag on the economy in multiple ways.”
The bankruptcy led to widely criticized austerity measures on an island that paid some $1 billion in fees to consultants and lawyers and in other expenses during the process.
