Puerto Rico Public Finance skips appropriation bonds interest payment

By Caroline Salls

Pittsburgh, Oct. 5 – Puerto Rico Public Finance Corp. did not make the interest payment due Oct. 1 on its series 2012A commonwealth appropriation bonds, according to a notice released Monday.

As previously reported, bond trustee U.S. Bank NA announced on Oct. 2 that no funds had been received from Puerto Rico Finance for payment of debt service due on Oct. 1 on the series 2012A commonwealth appropriation bonds, according to a notice released Friday.

Puerto Rico Public Finance said in July that the final budget approved by the Puerto Rican Legislative Assembly for the fiscal year 2016 did not include appropriations to pay principal and interest due on the bonds.

As a result, PRPFC has taken the position that since there was no legislative appropriation for fiscal year 2016 debt service, no payments can be made, and there is no default arising from their failure to make such payments.

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