Puerto Rico dispersed millions of dollars in holiday bonuses to government workers on Wednesday despite a warning from its federally appointed oversight board that doing so could harm the bankrupt U.S. commonwealth’s ability to make payroll later in the current fiscal year, Reuters reported.
Puerto Rico in Distress
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Puerto Rico concluded a U.S. bankruptcy court-approved restructuring of its Government Development Bank (GDB) debt, marking its first consensual deal with creditors under a federal oversight law, government officials announced yesterday, Reuters reported.
Puerto Rico is poised to restructure the Government Development Bank’s debt by exchanging its bonds for $2.6 billion of new securities, the first such debt swap for the U.S. territory since it collapsed into bankruptcy in May 2017, Bloomberg reported. The transaction will restructure about $4 billion of Government Development Bank debt.
When Congress set out to legislate a solution that would help address Puerto Rico’s debt crisis almost three years ago, one of its main bipartisan objectives was to avert catastrophe.