Image: Reuters Berita 24 English - According to a statement from legal consultant White & Case LLC, more than 30 asset managers holding...
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| Image: Reuters |
Berita 24 English - According to a statement from legal consultant White & Case LLC, more than 30 asset managers holding Sri Lanka's international bonds announced the formal establishment of a creditor group on Tuesday to begin debt restructuring talks with the island nation.
The group's steering committee includes Amundi Asset Management, BlackRock, HBK Capital Management, Morgan Stanley Investment Management, and T. Rowe Price Associates Inc, with Rothschild & Co serving as financial adviser.
"The Group is generally representative of Sri Lanka's bondholder base, both by kind of institution and by region, and holds Bonds throughout each outstanding series," the statement continued, but it did not disclose what percentage of the $12.6 billion in outstanding offshore government debt it holds.
Sri Lanka has retained Lazard and Clifford Chance as financial and legal counsel as it prepares to restructure its complex web of creditors, which includes bilateral funding from Japan, India, and China.
The creditor group stated that it was willing to meet with Sri Lankan officials as well as other creditors, and that the country should "implement a package of substantial reforms and fiscal adjustments."
Economic mismanagement and the COVID-19 pandemic have left the country of 22 million people facing its worst financial troubles since independence in 1948, with imports of essentials such as fuel, food, and medications halted due to a shortage of foreign exchange reserves.
Sri Lanka was sued in the United States District Court in Manhattan late Tuesday by a private bondholder over the country's purported failure on a $1 billion sovereign bond due next month.
Sri Lanka had stopped servicing its sovereign debt and skipped payments on two other notes, producing a cross-default, according to Hamilton Reserve Bank Ltd, which sought urgent payment of $257.5 million in principal plus interest.
Early this week, a staff delegation from the International Monetary Fund (IMF) arrived in Sri Lanka to resume talks on a rescue programme.
