BASSETERRE, St. Kitts – HOLDERS of government-issued bonds which matured late last month have been asked to forbear as the government of St. Kitts Nevis consults with its debt managers in devising a more suitable arrangement for payment.
This was confirmed by Prime Minister and Minister of Finance, the Right Hon. Dr. Denzil L. Douglas during his monthly press conference yesterday (Nov. 30) at the Parliamentary Lounge in Government Headquarters.
Asked whether or not this was true, the Prime Minister explained that the only bond which is to mature around this time, as far as he is aware, was issued on the Regional Government Securities Market (RGSM) and that it is valued at an approximate $75M.
“…There are some bond holders on a particular bond that may be due for interest payment sometime this month and have been asked to hold because, as you know, we are engaged with our debt advisors on the restructuring of our debt and we have been advised that until the negotiations are completed, and a final position is taken, we would hold the payment of interest on these bonds until the final decision and agreement is made.”
A notice issued by the Eastern Caribbean Securities Exchange (ECSC) on November 30, 2011 entitled, “Notice of non-payment of interest: Government of St Kitts and Nevis’ 10-year Bond, KNG101112” explained that the Eastern Caribbean Central Securities Registry (ECSR), which is the “Paying Agent for the bond”, did not receive the necessary funds which resulted in them being unable to “make the 18th interest payment on the bond”.
Dr. Douglas noted that the government’s debt advisors are currently negotiating with the bond holders with a view to crafting a new payment arrangement.
“The bonds are subjected at the moment to negotiations. Our debt advisors are speaking with our bond holders as to exactly what the new arrangement would be. Whether it would be a longer term or whatever interest would be. Those are ongoing negotiations which are taking place and so at the moment, I suspect that we have been advised, the Ministry of Finance I am sure would have been advised, not to make any transfer of payments to the facility that is managing the bond for the bond holders…Maybe I should point out that our treasury bills are not part of the debt restructuring exercise.”
These bonds, according to the Prime Minister, were issued on behalf of the government in an attempt at raising revenue.
