Weekly Report - 8 June 2004

ARGENTINA | Offer to bondholders improved. On 1 June economy minister Roberto Lavagna unveiled the expected improvement to the bond rescheduling deal offered last September in Dubai. The big difference is that Argentina now offers to include the interest accrued since the default. This leaves the nominal `haircut' at 75%, but shrinks the cut on the net present value of the bonds from 90% to 75%. The offer also includes an inflation-linked bond tailormade for the local holders of defaulted bonds (who account for 42% of the total).

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