Tuesday, February 18, 2014

PUERTO RICO TO GET BAIL OUT?

If this is true, it's another example of how Puerto Rico's Elite Governing Families continue to make money with deals resulting from the present economic crisis due to their own bad administrations. They also probably have tax gimmicks so as not to pay US or PR taxes. .... And the article says that we are going to be bailed out by Venezuela? That is incredible..... mj

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by PHILIPE SCHOENE ROURA, 
XAVIRA NEGGERS CRESCIONI &
JOHN MARINO
cbprdigital@gmail.com
Feb 10, 2014

CARIBBEAN BUSINESS learned last Friday that the Puerto Rico government has secured between $2 billion and $2.5 billion in a private financing deal through the Royal Bank of Canada, spearheaded by former Gov. Sila Calderón’s son, Francisco Xavier González, according to a Capitol Hill source.

That deal, which involves between four and six banks from Latin America, would pool together $2 billion to $4 billion. Among the banks mentioned by two sources close to the negotiation are Venezuela-based Banesco,Espíritu Santo Bank from Brazil and a Panamanian bank.


UPDATE: 
FEB 18, 2014

Sources: PR close to financing deal

"Royal Bank of Canada (RBC) said it is not leading any financing package for Puerto Rico and the Government Development Bank said such a loan deal is not in the works. “This information is wholly factually inaccurate and was not verified with us - had it been, we would have clarified that it was not correct,” RBC said in a statement Monday.

“Reports indicating that the Puerto Rico government has secured or is currently contemplating a loan ranging from $2 billion to $2.5 billion through the private Royal Bank of Canada as described are incorrect,” the GDB said in a statement issued Monday afternoon. “Royal Bank of Canada has not offered us a loan as described and are currently not aware whether the possibility exists.” However, CARIBBEAN BUSINESS sources said the deal involving several banks has been in the works for at least four months as the government braced for credit downgrades into junk territory. Both Standard & Poor’s and Moody’s Investors Service cut Puerto Rico’s general obligation debt below investment level last week.

While government officials were scrambling for private financing to avoid going to market, they also reviewed a similar deal with a Latin American syndicate in the neighborhood of several billion.

That deal, which involves between four and six banks from Latin America, would pool together $2 billion to $4 billion. Among the banks mentioned by two sources close to the negotiation are Venezuela-based Banesco, Espíritu Santo Bank from Brazil and a Panamanian bank. “The banks would form a syndicate to provide a bailout package,” said the CB source who wished to remain anonymous. “The syndicate would pay the immediate debt payment [triggered by the downgrade], which is due by May. They would pay more than $2 billion, and then another $940 million and another $100 million going toward the budget and to stimulate the economy.”
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