Puerto Rico in Distress

ABI Analysis

Puerto Rico’s power company will begin shutting down as soon as Friday if it doesn’t receive a $1 billion loan from the territory’s central government, threatening to cause widespread electricity outages across the hurricane-devastated island, a lawyer for Puerto Rico told a U.S. judge, Bloomberg News reported.

A top Puerto Rico senator is suggesting that the bankrupt island accept its own deeply distressed bonds as collateral - at nearly full-value, no less, Bloomberg News reported.

Puerto Rico Governor Ricardo Rosselló yesterday released a revised fiscal plan that will use $18 billion of additional money from the U.S. federal budget to transform the bankrupt island’s deficit into a $3.4 billion surplus within six years, Reuters reported. The injection of new funding from the federal budget, enacted earlier this month, will let the U.S.

Puerto Rico said on Friday that it will receive $16 billion in federal aid under a disaster recovery package signed on Friday by U.S. President Donald Trump, Reuters reported. That money includes nearly $7 billion announced on Wednesday and will help the bankrupt U.S.