NEW YORK -- Citibank said Friday that Brazil issued $7.1 billion of bonds covering the remaining past-due interest on bank debt for 1989 and 1990.
An agreement with bank creditors was ratified in June 1991 by the Brazilian Senate.
It provided that 25% of the back interest be paid in cash in 1991. The remaining 75% was to be resolved by the issuance of bonds after an agreement in principle was reached on Brazil's $44 billion of medium- and long-term debt to foreign commercial banks.
That agreement was reached July 9 after much negotiation. The term sheet detailing that agreement is before the Brazilian Senate for its consideration, said Citibank.
The senate, meanwhile, approved the new bond issue.
Steps Called Serious
The Citicorp subsidiary serves as chair of the Brazil Bank Advisory Committee.
"Taken together, these two developments further demonstrate the seriousness of the Brazilian government in regularizing its relations with the international banking community," said Citibank's vice chairman William R. Rhodes, who has served as chief negotiator for the banks.