March 03, Colombo (LNW): Sri Lanka has petitioned a New York federal court for a five-month postponement of a lawsuit initiated by a bondholder concerning the nation’s significant debt default.
The request aims to allow more time for negotiations with private creditors.
The lawsuit, filed by Hamilton Reserve Bank Ltd. in July 2022, demands full repayment of over $250 million in Sri Lanka’s dollar bond, which matured that same month.
Hamilton Reserve Bank claims ownership of more than 25% of the bonds, potentially granting it veto power over any proposed modifications to the debt terms.
In response to Sri Lanka’s recent request for an extension of the lawsuit delay, Hamilton Reserve objected, alleging that the country has withheld crucial negotiation details despite repeated inquiries from the bank.
Sri Lanka has expressed a commitment to addressing its obligations to private creditors as part of its efforts to expedite a comprehensive debt restructuring plan and emerge from sovereign default, as stated by the foreign minister in a recent interview with Bloomberg.
The legal matter is documented under Hamilton Reserve Bank v. Sri Lanka, case number 22-cv-5199, in the US District Court for the Southern District of New York (Manhattan).
