UPDATE 1-Ecuador could rework "illegitimate" debt- auditors
(Adds auditor's comment, background and details)
QUITO, Nov 17 (Reuters) - Ecuador could opt to restructure its global bonds due in 2012 and 2030 that were found to be "illegitimate," top auditors told Reuters on Monday.
"As I have said before a restructuring of the illegitimate debt has always been an option," said Franklin Canelos, the audit group's deputy chief. "There are many options and the president is the one who has to decide."
Ecuadorean President Rafael Correa has said that "illegitimate" debt are loans riddled with contractual irregularities acquired by previous administrations.
On Friday, Ecuador raised the specter of a debt default by delaying interest payments of its 2012 bond while it analyzes the findings of the government-appointed debt audit commission.
Finance Minister Elsa Viteri also said on Friday the government didn't rule out talks with bond-holders to rework the terms on debt found to be illegitimate.
Ecuador's global bonds due in 2015, 2012 and 2030 amount to around $3.8 billion, according to government data.
An audit group 200-page document obtained by Reuters in September recommended the government suspend payments of those three bonds, but that decision has been changed, the auditors said.
"The 2015 are not included in that recommendation," said Alejandro Olmos, one of the auditors probing commercial debt. "Our probe of the 2015 (bonds) was limited."
The 2015 bonds are linked to the "illegitimate" 2012 and 2030 global bonds, but the auditors said they were unable to finish the research on it.
Debt analysts say Correa's move to delay coupon payments aims to restructure its bonds to secure better terms for his OPEC nation. If the 2015 bonds are not included in the audit's recommendations, analysts say it could mean the government will not seek overly aggressive concessions, such as a large cut in the bonds value, from the holders of that debt.
Unlike other countries who seek a default, Ecuador has said it has enough funds to make payments.
Still, Ecuador's economy is feeling the pinch of falling oil prices and a global slowdown that reduces demand for its products, mostly farm goods.
(Reporting by Alonso Soto; Editing by Diane Craft)
