Ecuador Will Not Honor 2030 Bonds

Ecuador will not make $135m in coupon payments on its global 2030 bonds when a 30-day grace period ends March 15, its finance minister says. “Ecuador has decided not to make the payment at the end of the grace period because it is finishing, with its legal and financial advisors, the proposal for a global solution for the 2012 and 2030 bonds,” minister Elsa Viteri says in a statement. A proposal to repurchase the 2012s and 2030s is expected before the end of the month, according to wire and local news reports citing remarks made Thursday by economy minister Diego Borja. Lazard is advising Ecuador on the buyback offer. The sovereign has now, as widely expected, officially defaulted on 2 of the 3 issues it began studying last year to determine legality. The 2015s – issued when Correa was Finance Minister – have been given a different status and the government says it plans to honor them. Ecuador defaulted on the 2012s in December, and indicated last month it would use a 30-grace period to determine whether it would continue making payments on the 2030.