Restructuring Debt Restructuring

Sovereign debt restructuring

B. Debt restructuring

Devaluation and debt restructuring worked.

Proposals on debt restructuring frameworks

But internal devaluation requires debt restructuring.

B. Debt restructuring 11 28 7

No formal debt restructuring existed for debt owed to multilateral institutions.

The Lethal Deferral of Greek Debt Restructuring

The mechanics of debt restructuring are straightforward.

Calls for immediate debt restructuring went unheeded.

The debt restructuring package . 11 17 6

Securitization made debt restructuring difficult, if not impossible.

Alternatives to a debt restructuring are fast disappearing.

There have been many proposals on debt restructuring mechanisms.

The debt restructuring measures had dealt primarily with commercial debt and debt servicing obligations to official bilateral creditors.

Coercive restructuring of insolvent banks unsecured debt would be next.

So the need for debt restructuring is an unavoidable reality.

There is a simple way to deal with a debt overhang reduce payments by restructuring the debt.

In that study, the net present value of debt servicing was examined under different debt restructuring options.

If this principle prevails, no one would ever accept debt restructuring.

The restructuring of debt owed to private creditors was also an important aspect of external debt crisis resolution.

But, as we know from experience, there is life after debt restructuring.

The IMF sovereign debt restructuring mechanism (SDRM) proposal failed to gain support.

Fifth, debt burdens that cannot be eased by growth, savings, or inflation must be rendered sustainable through orderly debt restructuring, debt reduction, and conversion of debt into equity.

Unfortunately, however, ideas for debt restructuring mechanisms remain just that purely theoretical constructs.

The most recent debt restructuring of Argentina illustrated well the conditions described above.

Where realistic debt restructuring scenarios indicate capital shortfalls, across the board conversion of bank debt into equity will be necessary.

And debt and deficit concerns will remain, with the virtual certainty of at least one sovereign debt restructuring in Europe.

In the case of commercial bank debt, most of the heavily indebted middle income countries had succeeded in restructuring their debt.

In sum, debt restructuring activity has directly or indirectly touched most of the types of debt that developing countries have incurred.

But the restructuring of debt has been too little and has come too late.

Not surprisingly, leading bankers lobbied against debt restructuring, both behind closed doors and publicly.

By contrast, debt restructuring for either banks or governments is politically unacceptable in Europe.

Some participants stated that collective action clauses were a useful feature of debt restructuring.

India did its part by writing off the debt owed by African countries under the HIPC Initiative and by restructuring commercial debt.

The debt owed to multilateral financial institutions is the only category of developing country debt that has no formal framework of restructuring.

The whole point of restructuring was to discharge debt and make the remainder more manageable.

But it is a bit late for the ECB to describe debt restructuring as unthinkable.

But the most contentious part of debt restructuring could well be reaching inter governmental agreements.

On the verge of civil war, Iraq just announced a restructuring of its foreign debt.

The cost of debt service adjusts automatically, without the severe disruption that results from loss of confidence, crisis, debt restructuring, and so forth.

Some combination of debt restructuring and permanent debt monetization (quantitative easing that is never reversed) will in some countries be unavoidable and appropriate.

Ultimately, a significant restructuring of private and or public debt is likely to be needed in all of the debt distressed eurozone countries.

An international debt framework commission would aim for a coherent and comprehensive debt restructuring when requested to do so by the debtor country.