Puerto Rico Public Finance skips June 1 interest payment on 2012 A appropriation bonds

By Caroline Salls

Pittsburgh, June 7 – Puerto Rico Public Finance Corp. did not make the interest payment due June 1 on its series 2012 A commonwealth appropriation bonds, according to a notice filed Tuesday.

As previously reported, Puerto Rico Public Finance missed several other payments on the series 2012 A commonwealth appropriation bonds, dating back to August 2015.

In February, bond trustee U.S. Bank Trust NA said Puerto Rico Public Finance was not funding debt service for its series 2011 A and B and series 2012 A commonwealth appropriation bonds.

As previously reported, Puerto Rico Public Finance said in July 2015 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, Puerto Rico Public Finance 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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