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Argentina Pockets $35 Billion Windfall After Accounting Change

  • Central bank turns net positive by revaluing local bonds
  • Move allows central bank to pay dividends to the government
Argentine Peso Seen Avoiding Collapse After Hitting Record Low
Photographer: Sarah Pabst/Bloomberg

Argentina may be in deep financial trouble but its central bank is comfortably back in the black -- thanks to a small accounting maneuver.

A little-noticed decision by policy makers late last year to change the way they value government bond holdings transformed the central bank’s balance sheet overnight, turning what had been a net worth of negative $2 billion into positive $33 billion. Officials have made little effort to explain the move -- they just say it’s part of a wide-ranging emergency law to shore up the economy -- but analysts note how it will pave the way for the bank to start turning over dividends to the cash-strapped government.