CARACAS, Sept 6 Venezuelan state oil company
PDVSA said on Tuesday that Citibank will remain in charge of
making payments on its bonds, a week after Reuters reported that
Citi had announced its intention to withdraw from that role.
"It is false that there has been a substitution of Citibank
as paying agent for our (financial) instruments," PDVSA said in
a statement. "If there is any change with respect to this,
(PDVSA) will announce this in a timely and responsible manner.
The company assured that Citibank would be in place as
paying agent for PDVSA's upcoming maturities.
The bank did not immediately comment on PDVSA's statement,
but in the past has said it cannot discuss issues involving its
Citibank, a unit of Citigroup, in July told
bondholders PDVSA would need to name a new paying agent for
seven outstanding dollar-denominated bonds, according to three
investors who asked not to be identified.
But it also said it will continue to serve as PDVSA's paying
agent until it receives written notice that PDVSA has found a
new agent, according to a letter from Citi to bondholders seen
by Reuters. Citi confirmed the veracity of the letter but
declined to comment further.
PDVSA, which is struggling under low oil prices and a
collapsing socialist economy, in November must make a $2.05
billion amortization on its 2017N bond and a $1
billion maturity payment on its 2016 global bond.
Citigroup's decision will not interrupt payment of these
But it could interfere with plans announced by PDVSA
President Eulogio del Pino to swap 2017 bonds for new bonds with
a later maturity, as the new bond would not have a paying agent.
Sources last month told Reuters the company has begun
discussions with Credit Suisse for such a swap, but bondholders
and investors say they have not been approached by PDVSA.
Citibank in July said it planned to halt correspondent bank
services for the Venezuelan government's foreign currency
accounts, citing a periodic risk management review.
(Reporting by Eyanir Chinea, writing by Brian Ellsworth;
Editing by Bernard Orr)