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News ID: 76635
Publish Date : 29 February 2020 - 00:56

Lebanon to Ask for Grace Period for March 9 Bond

BEIRUT (Dispatches) – Lebanon intends to ask for a seven-day grace period for a $1.2 billion Eurobond that matures on March 9, as it is entitled to, in order to give financial advisers more time to draft a restructuring plan, a government source says.
Lebanon would seek the seven-day grace period ahead of the March 9 date, the source said.
Financial sources said the exercising of the seven-day grace period would make it more likely the government would seek to restructure the March 2020 Eurobond. Lebanon faces two further Eurobond maturities this year, one in April and one in June.
The Lebanese government this week appointed U.S. investment bank Lazard and law firm Cleary Gottlieb Steen & Hamilton LLP as its financial and legal advisers on the widely expected debt restructuring.
Earlier, Beirut had invited several international firms to bid to be its financial adviser on how to restructure and clear the country’s sovereign debt. And a team of experts from the International Monetary Fund (IMF) traveled to Lebanon and met with new Lebanese Prime Minister Hassan Diab last week.
The Lebanese Hezbollah resistance movement, whose party in parliament is one of the main backers of the new government, has opposed allowing the IMF to manage Lebanon’s financial crisis.
On October 29, the then-Prime Minister Saad Hariri resigned under pressure from the unprecedented protests, creating a political void that lasted until January 21, when Diab assumed office as the country’s new premier.
Diab faces one of the worst crises in his county’s recent history and urgent decisions about upcoming debt payments, particularly a 1.2-billion-dollar sovereign bond due early next month.
Lebanon’s national debt stands at around 85 billion dollars.