November 22, 2016 / 1:15 PM / 3 years ago

Venezuela PDVSA says in grace period for 2035 bond

CARACAS, Nov 22 (Reuters) - Venezuela’s state oil company PDVSA confirmed it is using a 30-day grace period for coupon payments on its 2035 bond, but said a JP Morgan report of payment delays on other bond issues was wrong.

JPMorgan analysts reported on Monday that PDVSA had delayed $404 million in payments on its 2021, 2024 and 2035 bonds. PDVSA responded that it had “punctually” paid its obligations due this month for 2021, 2024 and 2026 papers, and was also “in the process of executing” payments for the 2035 bond.

PDVSA president Eulogio Del Pino later Monday night told state television that the grace period for the 2035 bond had been activated, without providing an explanation.

“This is the final interest payment (of the year),” said Del Pino of payments on bonds other than the 2035 issue. “We have a grace period of 30 days which we are using,” he said, of the 2035 bond.

Investors have for years been concerned that cash-strapped PDVSA may ultimately be unable to meet its hefty debt obligations amid a profound recession at home and a fall in oil prices. As a result, Venezuela bonds trade at distressed levels.

Socialist President Nicolas Maduro says the country will meet all its debt commitments and calls default talk a right-wing conspiracy against him.

He has also accused global banks of leading a “financial blockade” that has left Venezuela with few financing options amid the oil market downturn. (Reporting by Eyanir Chinea; Writing by Girish Gupta; Editing by Alexandra Ulmer and Chizu Nomiyama)

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