Ecuador and its creditors are highly unlikely to reach an arrangement on restructuring the country's international bonds by the end of this month, and failure to do so could disrupt global financial markets.

At the heart of the problem are some $6 billion of so-called Brady bonds. Named for former Secretary of the Treasury Nicholas Brady, the bonds initially were issued in the late 1980s and early 1990s in a program to help emerging-market countries finance their debts to U.S. and other foreign banks.

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