Puerto Rico nears default as debt restructuring beckons

Puerto Rico's expected default on debt due Saturday would be the start to what could end up becoming one of the largest municipal restructurings, with the potential to open the door to a fight with investors and spark volatility in bond prices. Puerto Rico Governor Alejandro Garcia Padilla shocked investors in June when he said the island's debt - totaling $72 billion - was unpayable and required restructuring.

Puerto Rico has flagged that it will likely skip a $58 million payment due Aug. 1 on its Public Finance Corporation (PFC) debt, which has weaker investor protection than some other bonds.(Read Full Article Here)