Puerto Rico’s development bank forges deal with creditors

SAN JUAN, Puerto Rico – The leader of debt-swamped Puerto Rico says the U.S. island’s development bank has entered into a deal with creditors that would allow it to avoid a lengthy bankruptcy proceeding.

The liquidation deal still has to be formally approved by creditors of Puerto Rico’s Government Development Bank. But Gov. Ricardo Rossello said in a Monday statement that the so-called restructuring support agreement is backed by “a significant portion of its major stakeholders.”

Rossello described the agreement as “an example of the government regaining the credibility it had lost over the past few years.”

The deal focused on the bank is just one piece of an overall $73 billion public debt load that the government of the struggling U.S. territory is seeking to restructure.

Puerto Rico is mired in a decade-long recession.