Puerto Rico

A status report on the PREPA deal is due by noon on Friday.

Puerto Rico completed the exchange of more than $33 billion of existing bonds and other claims into $7 billion of new bonds plus cash and CVIs on Tuesday.

Restructured muni debt has "typically outperformed the broader muni market, as issuers emerge from bankruptcy with higher debt-servicing capacity and the debt re-enters the municipal high-yield index," noted PIMCO.

The ruling means the restructuring set for Tuesday will proceed.

The judges appeared skeptical about the need for a stay.

Judge Laura Taylor Swain says the termination of the PREPA deal could be a "major setback" to adjusting the authority's liabilities.

While the governor is hoping for a deal that would be cheaper for Puerto Rican consumers, the result may be the opposite, critics say.

A group of bondholders and bond insurers also submitted on Sunday a statement opposing the teachers’ request for stay.

The teachers are trying to prevent enactment on March 15.

Puerto Rico teachers' associations are trying to delay the March 15 enactment of the Plan of Adjustment while they appeal it.

The restructuring is on track to occur March 15, officials said.

The governor wants the current deal revised and to be able to participate in any mediation talks. Bond insurers, the Unsecured Creditors Committee and authority’s fuel line lenders also want to be included.

The board also says the bondholders' proposed deadlines for completing a restructuring are too tight.

The Oversight Board also approved a new fiscal plan for the Highways and Transportation Authority.

They say a Plan B that does not involve local legislative approval must be negotiated.

At issue is about $400 million the board would like Puerto Rico's government to retain.

The Puerto Rico Fiscal Agency and Financial Advisory Authority has requested pre-qualified investment banks to provide ideas and opportunities for refunding for savings.

While the Puerto Rico Senate would not take up a House-approved budget amendment that would allocate money to repay bondholders, analysts expect the Oversight Board to approve the funding.

The measure authorizes spending $10.9 billion from past years’ revenues for paying various Plan of Adjustment entities, including nearly $8 billion to pay bondholders and bond insurers.

Their filings in court follow similar arguments they made against teachers' associations last week.