BUENOS AIRES, September 30 (RIA Novosti) – Argentina's Economy Ministry on Tuesday said it had deposited a $161 million worth of public debt interest payments with a newly-designated local trustee after a US court held the South American nation in contempt of its ruling.
"By making this deposit, Argentina has once again confirmed its unwavering commitment to meet all of its obligations to the bondholders," the ministry said.
Buenos Aires made the deposit with a local trust bank, Banco de la Nacion Fideicomisos, after it broke up with the Bank of New York Mellon, which Argentina accused of failing to fulfill its duties as a trustee.
On Monday, US judge Thomas Griesa ruled that Argentina was in contempt of court for its attempts to avoid his orders to pay off hedge funds that sued the country for full payment on their bonds.
Most of Argentina's creditors agreed to a debt restructuring following its 2002 default. According to the agreements, Argentina will repay them 70 percent of the face value of their bonds.
Two US hedge funds — Aurelius Capital management and NML Capital – refused to accept the deal, prompting a US court to freeze Argentina's ability to transfer funds to restructured bondholders, as long as it does not pay the holdouts in the restructuring, mainly the $1.3 billion in bonds held by Aurelius Capital management and NML Capital.
The ruling forced Argentina into its second default in 13 years and the country passed domestic legislation aimed at transferring its bond contracts away from US jurisdiction to Argentine jurisdiction.
Argentina has also announced its plan to fire the Bank of New York Mellon for most of its debt payments.
