SAN JUAN, Puerto Rico (AP) — Officials announced a settlement late Sunday with bondholders that would reduce Puerto Rico’s public debt by 70%, but the U.S. territory’s governor swiftly rejected it, saying it puts too heavy a burden on the island’s retirees.
The settlement is the biggest one to date since Puerto Rico’s government announced in 2015 that it was unable to pay its more than $70 billion public debt load and filed for the largest U.S. municipal bankruptcy in May 2017.
The newest deal reached between a federal control board overseeing Puerto Rico’s finances and several groups of bondholders would reduce the island’s bond debt from some $35 billion to roughly $11 billion.
However, Gov. Wanda Vázquez rejected the settlement and noted it still requires legislative approval.
“If the bondholders receive better treatment in the bankruptcy process, so should retirees,” she said.