Sovereign Debt

Ordered not to carry out its planned swap into local-law (and local payment) bonds, Argentina has now deposited funds for the June 30 payment with Bank of New York Mellon, trustee under the exchange bonds.

Yesterday's post noted that, by asking Judge Griesa to re-impose a stay of the injunction, Argentina was effectively asking for permission to pay exchange bondholders on June 30 without making any payment whatsoever to NML and the other plaintiffs. Not surprisingly, plaintiffs oppose the motion.

A footnote to Mark's recent post on Argentina's remaining options got me thinking about what an Event of Default actually is under the exchange bond indenture. From a reasonably quick look at the (lengthy) documents, I think there might be a non-default route open to Argentina, and possibly also a procedural route to getting the pari passu clause interpretation in front of a New York State court.

The exchange bond indenture para.

It's done!  As Mark has chronicled, the U.S. Supreme Court has drawn the curtain on the pari passu drama, and separately has rejected Argentina's appeal to limit the scope of discovery by creditors with judgments against it. I am still undecided about how much I will miss it all. Meanwhile, here are two lists -- so-what and what-next.

So What: