No to Superbond 3.0! Bondholders’ Advisor Explains Why

It didn’t take the Bondholder Committee appointed last week more than seventy-two hours to say no to Belize’s offer for a restructuring of the terms of the 2038 U.S. Dollar Bonds or the Superbond. The committee today called the offer “premature,” considering that it seeks consent from a committee who will not give it and advises all bondholders not to accept it. Among other things, the Committee complains that Belize is asking for a further forty percent reduction in the present value of the Bond on top of the cumulative fifty percent reduction already provided in two previous restructurings. Adviser to the Committee Charles Blitzer told News Five this afternoon that bondholders will not abide repeated restructuring of the terms to please a Government who they think might be hard-pay.

On the Phone: Charles Blitzer, Blitzer Consulting

“In the view of the bondholders, this is the third time that Belize has asked for debt relief with the same underlying obligations, which is unusual; unprecedented. And it is important for the bondholders that this not be repeated endlessly. And, the reason why we are not ready to accept this offer, is because we see – we, the bondholders – and Belize have a shared interest in Belize doing better: its economy being stronger, and its crisis risk being less. And the bondholders cannot be by themselves a solution to the problem. It has to include a strong program of adjustments by the Government to reduce crisis risk, and so we’ve been asking for additional information and evidence which would support the notion that Belize is indeed turning a corner, and not just putting itself in the position of asking the bondholders for the same type of relief two or three years from now.”