Chile, Banks Rework $12 Billion in Loans at Lower Interest
Chile has reached agreement with its bank lenders to reschedule $12 billion in loans due through 1993 at lower interest rates, a government spokesman said today.
A 12-bank committee headed by Manufacturers Hanover Trust late Wednesday night in New York agreed to roll over $9.5 billion in loans, due as of 1988, at one point over the London interbank lending rate (LIBOR), the Finance Ministry spokesman said. The banks also agreed to refinance $2.5 billion in short-term debt due this year at 1 1/8 over LIBOR, he said.
These interest rates are one full point lower that those obtained by Chile when it last rescheduled the bulk of its $20-billion foreign debt in 1985.
The settlement, which faced strong opposition from Citibank, will mean a relief of $650 million for Chile over the next two years.
Of the $20 billion Chile owes, more than a third is owed to U.S. banks.
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