The Puerto Rico Electric Power Authority said Thursday that its trustee had made an unscheduled withdrawal of $41.6 million from the debt service reserve.
The withdrawal was made to cover a shortfall in the bond service and redemption account, the posting to EMMA said. The posting said the draw took place on or before July 1.
The withdrawal would be considered a technical default, Axios Advisors managing partner Triet Nguyen said. Puerto Rico spokespeople rejected that interpretation.
"The most important fact about today's disclosure is that PREPA made its bond payments as scheduled on July 1, 2014 - payments totaling more than $417 million," they said in a emailed statement. " We continue to provide our customers with uninterrupted service and have more than sufficient liquidity to continue to pay our employees and suppliers on a timely basis."
On July 1 PREPA made $418 million in debt service payments on its bonds.
The rating agencies have lowered PREPA bonds to low speculative ratings in the last few weeks. Fitch Ratings has said that PREPA default was probable.
