Argentina Defaults On Par Bonds, Risking Acceleration
Law360, New York (October 31, 2014, 9:12 PM EDT) -- Argentina on Thursday defaulted on its debt for the second time since July when it failed to make a coupon payment on $5.4 million in par bonds issued under foreign law, thus raising the danger of acceleration and economic collapse.
With this default, Argentina puts itself at increasing risk that investors will accelerate payment, meaning they will demand 100 cents on the dollar for their securities plus past-due interest.
While Argentina already defaulted in July on its discount notes, holders of the defaulted par bonds are more likely to accelerate payment because they are trading at a steeper discount to their...
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