Argentine stocks fell to a five-month low on news of a ruling that hadn’t been officially released by the New York court that issued it.
U.S. District Judge Thomas Griesa Nov. 21 ruled that Argentina must pay $1.33 billion to holders of its defaulted debt if it goes forward with next month’s scheduled payments of more than $3 billion on the nation’s restructured bonds.
The Merval index fell 3.3 percent to 2,242.40 yesterday in Buenos Aires, the lowest since June 14 and the biggest one-day drop since Oct. 23.
The ruling, which was obtained by Bloomberg News on Nov. 21, wasn’t available on the electronic service used by the U.S. courts to provide public access to court records.
Griesa ruled that Argentina must pay the money it owes the so-called holdouts, led by a unit of billionaire hedge fund manager Paul Singer’s Elliott Management Corp., into an escrow fund while it appeals the judge’s decisions. The country has until Dec. 15 to comply.
“Argentina must pay the debts which it owes,” Griesa, 82, wrote. “After 10 years of litigation this is a just result.”
Griesa’s rulings were contained in two court opinions and an order, each of which bears the judge’s signature and a stamp indicating it had been filed electronically Nov. 21. The Manhattan courthouse was closed yesterday for the Thanksgiving holiday.
A call to Griesa’s chambers after business hours Nov. 21 wasn’t returned. Stephanie Cirkovich, a spokeswoman for the Manhattan-based federal court, declined to comment yesterday on the release of Griesa’s ruling.
A U.S. appeals court on Oct. 26 upheld earlier rulings by Griesa that said holders of defaulted debt should be treated the same as investors who accepted bonds offered in two restructurings, after the country’s record $95 billion default in 2001. Speculation that Argentina will stop payments on its performing bonds rather than pay holdouts has made its debt the costliest in the world to insure against default.
The case is NML Capital Ltd. v. Republic of Argentina, 08-cv-06978, U.S. District Court, Southern District of New York (Manhattan).