UPDATE 2-Puerto Rico oversight board taps ex-Cleary lawyer as general counsel

(Adds that El Koury did not work on Puerto Rico while at Cleary)

Feb 23 (Reuters) - The federally appointed board tasked with managing Puerto Rico’s finances hired retired attorney Jaime A. El Koury, formerly of Cleary Gottlieb Steen & Hamilton, as its general counsel, it said on Thursday.

El Koury, a graduate of Yale Law School, will lead the board in helping the U.S. territory restructure some $70 billion in debt.

Cleary was counsel to the Puerto Rican government during ex-Governor Alejandro Garcia Padilla’s administration, from 2014 to 2016. El Koury retired from Cleary in 2014 and did not work on the Puerto Rico matter while at the firm, board spokesman Jose Cedeno said.

New Governor Ricardo Rossello, who criticized Garcia Padilla’s fiscal policies and legislative initiatives during last year’s campaign, fired Cleary when he took office on Jan. 2.

El Koury will advise the oversight board, which is separate from the island’s government, although the two will work closely in the coming months as Puerto Rico tries to restructure debt and stave off economic crisis characterized by a 45 percent poverty rate and near-insolvent public health and pension systems.

Under a 2016 federal rescue law known as PROMESA, the board must approve Puerto Rico’s budgeting and financial turnaround strategies, a source of tension among locals and Puerto Rico lawmakers, who see it as encroaching on the island’s self-governance.

El Koury, born and raised in Puerto Rico, worked on myriad corporate matters at Cleary, including mergers and acquisitions, restructurings and other financial transactions, the oversight board said in a statement.

“We are very pleased to be able to count on Jaime’s legal expertise, negotiating abilities, understanding of economics and impeccable ethical and professional credentials,” José Carrión, the board’s chairman, said in the statement.

El Koury said he welcomed the chance to help revitalize his island. “PROMESA is a tool provided by Congress to help get the island back on the path of fiscal balance,” he said in the statement. “And I will do my very best to help the Oversight Board achieve those goals.” (Reporting by Nick Brown; Editing by Andrew Hay and Dan Grebler)