Doral Financial calls 7.84% notes, to solicit consents

New York, Dec. 19 - Doral Financial Corp. said it will redeem its 7.84% senior notes due Oct. 10, 2006 and solicit consents for bonds issued under its 1999 indenture.

The actions are designed to remove the uncertainty that would be created if the company received a notice of default, Doral said in a news release.

By taking these steps, the San Juan, P.R., mortgage lender and commercial bank will be able to complete the restatement of its accounts "in an orderly manner."

The 7.84% notes will be redeemed "as soon as practicable," with the precise date to be announced.

Doral will pay the greater of par and the sum remaining principal and interest payments discounted at Treasuries plus 25 basis points. The price is expected to be above par. Holders will also received accrued interest up to the date of redemption.

In the consent solicitation, Doral will access holders to temporarily forbear from declaring a default due to the company's failure to comply with its reporting obligations.

Doral said it expects to file its amended form 10-K for the year ended Dec. 31, 2004 within approximately 60 days and its 10-Q reports for the first three quarters of 2005 as soon as practicable after the filing of its 10-K.

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