Bloomberg Quotes Eric LeCompte on NY Bills Impacting Private Creditors and Sovereign Debt Restructurings

Bloomberg quotes Eric LeCompte on the NY Bills that aim to limit the amount private creditors can recover in sovereign debt restructurings. Read an excerpt below, and click here for the full article.

New York Bills That Cap Key EM Debt Payouts Rile Pimco, Fidelity

By Zijia Song and Ezra Fieser 

Major investors from Pacific Investment Management Co. to Fidelity Investments are pushing back against New York bills that stand to limit the amount private creditors can recover in sovereign debt restructurings.

The legislation — comprised of proposals in both the state senate and assembly — would force investors in defaulted sovereign bonds to accept comparable losses to governments and other public creditors during restructurings. If passed, the new rules would apply to debt governed by New York law, which makes up about half of all emerging-market bonds.

While similar proposals have failed to gain traction in the past, momentum is building behind the new legislation and stoking concern among some of the world’s biggest asset managers.


Read here for more.