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Chief of Cabinet Jorge Capitanich announces more bad news for the BoNY (photo: Ricardo Ceppi, prensa jefatura de gabinete/ddc)
A number of exchange bondholders filed a lawsuit against the Bank of New York Mellon (BoNY) in London for not releasing the interest payment the Argentine government deposited in their New York branch and which was blocked by Judge Thomas Griesa’s ruling.
George Soros’ Quantum Partners, Kyle Bass’ Hayman Capital, and other hedge funds contend that the BoNY failed to meet its obligations with its clients by not paying them €226m in Argentine debt interests, because Judge Griesa does not have jurisdiction over their bonds.
“Our bonds are governed by British law, which has not ruled [over the conflict between Argentina and the vulture funds],” said Bass. “As long as there isn’t a similar decision [to that of Judge Griesa] in the United Kingdom, they owe us the payment of our interests.”
This is not the first lawsuit against the BoNY by exchange bondholders, with similar legal actions currently being carried out by other hedge funds in New York and Europe.
Further complicating matters for the bank, Chief of Cabinet Jorge Capitanich announced this morning that the government “has revoked the BoNY’s representation in Argentina” due to a breach of contract. The bank’s licence to act as intermediary between the government and the bondholders was cancelled by a Central Bank resolution, in a step towards changing the entity responsible for making the payments.
“Argentina notifies and sues the trustee for a breach of contract, and this is why we are proposing to change the payment entity, to guarantee that creditors [can get paid],” said Capitanich.
The post Vulture Funds: Exchange Bondholders Sue Bank of New York appeared first on The Argentina Independent.
