COFINA Senior Bondholders Group Believes Puerto Rico's May 1 Default Reinforces the Importance of Passing PROMESA

WASHINGTON, May 2, 2016 /PRNewswire/ -- The senior creditors of the Puerto Rico Sales Tax Financing Corporation ("COFINA") issued the following statement today regarding Puerto Rico Governor Alejandro Garcia Padilla's executive order to suspend debt payments owed by the Government Development Bank (GDB):

"Without the legal framework and restructuring tools required to address this debt crisis, Puerto Rico's leaders will continue making decisions out of desperation. Governor Padilla's executive order to default on nearly $370 million in bond payments should underscore for Congress that the cost of political inaction is rising and reinvigorate members' efforts to pass the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). Although the suspension of payments by the GDB does not impact COFINA's creditors, our group wants to reiterate its support for pragmatic legislation that helps overhaul the Commonwealth's obligations, reignite on-island growth and shield U.S. taxpayers from funding a bailout," said former Senator Judd Gregg (R-NH), an advisor to the COFINA Senior Bondholders Ad Hoc Group.

Sen. Gregg adds: "Input from solutions-oriented creditor groups and conservative policy experts is helping the House Natural Resources Committee improve its initial version of PROMESA. We ask all external stakeholders to join us in helping the Committee finalize a bill that treats bondholders equitably and fairly based on their legal rights. Now is the time for responsible action—otherwise U.S. taxpayers as well as the Puerto Rican people will be at risk."

About Senator Judd Gregg
Gregg served as a United States Senator from 1993 to 2011.  He was Chairman and Ranking Member of the Senate Budget Committee and also Chairman and ranking member of the Health, Education, Labor and Pension Committee.  He was a senior member of the Senate Banking Committee and chaired the Appropriation's subcommittees on Foreign Operations; Homeland Security; and Commerce, State and Justice.   He also served on President Obama's National Commission on Fiscal Responsibility and Reform (Simpson-Bowles) and worked to produce a comprehensive plan to reduce the national debt. Prior to his tenure in the Senate, Gregg served as Governor of New Hampshire and as a U.S. Representative. As Governor, Gregg steered New Hampshire through one of its most difficult economic times leaving it with a balanced budget and a strong infrastructure, which included reorganizing the State's major utilities and banking system.

About the COFINA Senior Bondholders Ad Hoc Group
The Group is a coalition of creditors made up of retirees and individual investors in Puerto Rico and throughout the United States, as well as asset managers GoldenTree Asset Management LP, Merced Capital LP, Tilden Park Capital Management, Whitebox Advisors LLC, and others. 

The COFINA Senior Bondholders Ad Hoc Group has come out in support of many of the components of the PROMESA legislation released by the House Natural Resources Committee. The framework ensures that creditors are treated fairly and equitably based on their legal standing and provides a strong foundation for federal legislation to address the Commonwealth's economic crisis. Our group believes efforts to reach consensual debtor-creditor agreements should be encouraged, but will ultimately require PROMESA to implement and bind holdouts.

Media Contact:
Greg Marose
Edelman D.C. (on behalf of COFINA's senior creditors)
201-936-4126
[email protected] 

Chris Mittendorf 
Edelman NY (on behalf of COFINA's senior creditors)
212-704-8134
[email protected] 

SOURCE COFINA Senior Bondholders Ad Hoc Group