Puerto Rico’s debt problems have been well chronicled in recent months. However the situation is going from bad to worse, according to Marathon Asset Management CEO Bruce Richards, who said the island is in desperate need of restructuring during an upcoming appearance on FOX Business Network’s Wall Street Week.
“They’re in need of restructuring, so, $70 billion in debt is the total amount of debt that Puerto Rico has issued. Their GDP has been shrinking for eight successive years. And the GDP is the same number: $70 billion. So the debt to GDP is 100%. It’s unsustainable. And a restructuring is needed,” said Richards.
Catch his full interview on the upcoming edition of Wall Street Week, which airs on Friday at 8 p.m. ET.
In related news, Moody’s issued a report this week that said “a recent decision by the Commonwealth of Puerto Rico to temporarily halt government and corporate debt payments while imposing a stay on bond holder litigation will likely spark a flurry of bondholder lawsuits. These actions will likely complicate or delay efforts at achieving negotiated debt restructuring agreements.”