The Wrong Time to Go Bust: Investors Wary of Distressed Lebanon Debt

With distressed debt investors and emerging markets funds suddenly faced with one of the sharpest asset price falls in a generation, Lebanon picked the wrong time to go bankrupt, Reuters reported. Funds are still circling as the clock ticks down on Lebanon’s first sovereign default, but some may not buy until after the government unveils plans to revamp the debt and reform its economy, and the dust settles on a global asset plunge. More than $450 million of the debt has been traded since the government said at the weekend it could not meet its foreign currency debt, MarketAxess data showed. Lebanon is on a path to default when the grace period for its $1.2 billion Eurobond expires on Monday. Hedge funds and distressed debt funds were among the buyers this week, two financial sources familiar with the matter said. Read more