Citibank banned from exiting Argentina 28 May 2015Buenos Aires Reporter: Stephanie Palmer
Image: Shutterstock
An Argentine court has forbidden Citibank from taking any further steps towards leaving the custody space in Argentina, as long as the dispute over unpaid debt settlements and bond repayments remains unsettled.
Citibank had revealed plans pull out as custodian of some Argentine bonds as a result of the ongoing disagreement.
The issue stems from Argentina’s debt default in 2001. The majority of creditors agreed to accept exchange bonds at a write-down, however two US hedge funds won a lawsuit against Argentina for full repayment.
In March, a US district court judge ruled that Citibank should not issue interest repayments to Argentine bond holders, because of a previous ruling prohibiting institutions from assisting Argentina in servicing debt before repaying the hedge funds in question.
Last month, the Argentinian government announced it was suing Citigroup in Argentina over its failure to make repayments to Argentine bondholders.
Argentine president Cristina Fernandez has called on Citibank to “obey Argentine laws” in the matter.
NO FEE, NO RISK 100% ON RETURNSIf you invest in only one asset servicing news source this
year, make sure it is your free subscription to Asset Servicing Times
Image: Shutterstock 