Ecuadorean Bonds Drop as Government Calls for Time

Ecuador has acknowledged it will fail to make coupon payments on three bonds due later this week but insists it will pay up within the 30-day grace period, as it scrambles for cash amid the Covid-19 outbreak and the crash in oil prices, the Financial Times reported. In an online press conference on Monday night, finance minister Richard Martínez said the government would make a $325m payment due on Tuesday on its 2020 bond, but needed more time to come up with $200m to service bonds due in 2022, 2025 and 2030. Coupon payments had been due this Friday and Saturday. He said Ecuador was in talks with all its creditors — bondholders, bilateral lenders (notably China) and multilateral lenders — to ease its debt burden. Ecuador’s financial woes have spooked markets, with the spread between Ecuadorean bonds and US Treasuries lately soaring to the kind of levels typically associated with default. Read more