MBIA and Assured slide on Puerto Rico reversal

|About: MBIA Inc. (MBI)|By:, SA News Editor

Reversing his previous position on the matter, Puerto Rico Governor Alejandro Garcia Padilla throws his support behind legislation which would allow certain public companies to restructure their debt.

Public utilities such as the electric and water companies would be allowed to negotiate with creditors to ease their debt loads under the new law. Bulls on the situation in Puerto Rico have consistently pointed to the willingness of authorities to make good on the Commonwealth's debts.

Yields on Puerto Rico Electric Power Authority bonds maturing in three years have spiked all the way to 22%.

MBI -3.2%, AGO -2.4%