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G25
Cooperativismo
Ahorro y Crdito
G.O.s
$12,602,715
23.95%
$21,478,964
40.81%
COFINA
$18,546,739
35.24%
Total*
$52,628,418
100.00%
Balances calculated using figures disclosed by the Commonwealths Working Group in its FEGP which have not been
independently corroborated. Includes accreted values of CABs as of 6-30-2016
* The Working Group and its advisors (Millstein and Cleary-Gottlieb) have stated that PR assigns 36% of the General Funds Internal Revenues to debt service of GO and
Related Entities and proposes to reduce it to 15%. Estimates.
** UPR Pledged Revenues $75MM, PBA Debt Service Rentals $250MM, HTA $300MM, PRIDCO Rentals $60MM.
Their actions propitiated materialization of the Legislative Appropriation risk with regards to certain Related
Issuers (for example GDB, PFC), thus producing defaults and bleeding the GDBs liquidity and capital.
To partially reestablish liquidity to the State, provide permanent working capital and enable an orderly transition to the upcoming
Administration, a new money series for $1,000 MM would be included in the restructuring transaction to refinance the 2016 TRANs.
A portion of the new money would be used to repay the TRANs acquired by different instrumentalities of the Government .
The unused balance would be retained by a Trustee * and disbursed to the PR Treasury for specifically agreed upon purposes.
Debt Service would be reduced to $729MM annually, reducing annual cash outflows on average $409MM during the years 2017 to
2022.
Issuer
($000s
)
Outstandi
ng
Balance
HairCut
Net
Balance
$3,841,110
10% $3,456,999
$3,655,922
10% $3,290,330
$4,878,660
10% $4,390,794
PBA
$4,071,837
5% $3,868,245
The
Restructuring
Agreement
and
exchange PFC
$1,090,740
10% $981,666
documents would prohibit any and all bond issues of PRCCD
any kind by any of the restructured issuers until the A
$ 397,740
10% $357,966
rebalanced bonds have been fully paid.
PRIFA
$2,847,605
10% $2,562,845
Permanent coupon reduction to 4.5%.
Entry-Point Clause: To prevent unjust or excessive PRIDCO $ 177,105
10% $159,395
* The Re-balancing
Restructuring assumes
that COFINA
generates
funds thatsuffered
are not Available
to the General Fund
and that the SUT can
amortize
$ 518,245
10%
$466,421
enrichment
in light
of the
discount
byRevenue
the UPR
COFINAs debt and contribute to the General Fund the remaining funds.
$19,534,65
5
For Discussion
Purposes
traditional investors, the exchange
price would
be
Total
$21,478,964
9
Only
percentage
point
represents
approximately
COFINA has been assigned 3.5% of the SUT for Debt Service,
that is $784MM, which covers 1.18 times $667MM of the
2016 debt service.
During the next 4 fiscal years debt service is well covered
assuming a conservative growth rate of 0.5% of SUT
revenue. Thereafter, the annual increase in COFINA debt
service would require significant growth in SUT revenues
(2.5% annually after 2021 and 4.0% growth from 2024
onwards).
In light of these conditions the Rebalancing Restructuring of
COFINA requires a combined strategy of the following
measures:
COFINA
Senior Lien
Sub Lien
Total
Outstandin
g Balance
Hair-Cut
7,584,478,6
70
5%
10,962,261,
044
10%
18,546,739,
714
Net
Balance
7,205,254,7
37
9,866,034,9
39
17,071,289,
676
7
The Commonwealth will endow PRIEDFT up to 2% of the SUT and will contractually
commit to not restrict nor interfere with the flow of funds to the trust until any
financing structured by the PRIEDFT is fully repaid.
COFINAs Trustee shall transfer to the trustee for the PRIEDFT the amount of SUT
owed without intervention of Government of Puerto Rico. The rights of COFINAs
bond holders will not be altered.
For illustration purposes only: A bond issue at 7% True Interest Cost for 30 years
and to which 2% of SUT ($448MM) is assigned for debt service could raise up to
$5,556MM.
This would effectively institute a capital investment program of approximately
$550 million annually for the next 10 years.
For Discussion Purposes
Only
10