January 17, 2017 / 6:26 PM / 2 years ago

Belize creditors reject government offer on bond restructuring

NEW YORK, Jan 17 (IFR) - A committee of Belize creditors has rejected proposed changes to terms in the country’s US$530m super bond that were put forward by the government last week.

The bondholder group - appointed by a majority of holders of the 2038 notes and recognized by the trustee, Bank of New York Mellon - said in a statement on Tuesday that the changes would reduce the net present value of the bond by over 40%.

Belize launched a consent solicitation on January 12 to amend the amortization schedule and lower the coupon on the note, which local authorities say the country is unable to pay.

The solicitation is all but certain to fail without agreement by the committee members as it requires approval from holders representing 75% of the bond.

The committee said the economic measures that Belize has put forward so far are “unlikely to reduce future risks to debt sustainability or to the stability of the country’s currency peg in a sufficient manner.”

The creditors have asked the government to seek technical assistance in developing “a comprehensive home-grown adjustment program” that could receive the endorsement of multilateral lenders.

The committee was formed at the end of last year by Greylock Capital Management, Grantham Mayo van Otterloo, Steadfast Insurance Company and Capital Markets Financial Services. (Reporting by Davide Scigliuzzo; Editing by Natalie Harrison and Jack Doran)

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