(Adds details from letter, background on Puerto Rico's economic crisis, dateline, byline)
By Nick Brown
NEW YORK, Jan 18 (Reuters) - Puerto Rico's federal oversight board said on Wednesday it was willing to extend key deadlines that would give the debt-laden U.S. territory's government more time to negotiate restructuring deals with holders of its roughly $70 billion in bonds.
In a letter to Governor Ricardo Rossello, the oversight board said it "is favorably inclined" to grant the governor's request to extend to May 1 from Feb. 15 a freeze on litigation from creditors over missed debt payments.
It also said it favored extending until Feb. 28 from Jan. 15 a deadline for Rossello to submit a fiscal turnaround plan for the island.
Both requests will be taken up formally "later this month," the board said, and would be conditioned on the government agreeing to turn over more information about its financial picture and not to take on more short-term liquidity loans.
The board said Rossello's fiscal plan should aim to generate $4.5 billion annually in new revenues or savings through fiscal 2019. It laid out specific areas the plan should address, including shrinking the size of the government, pension reform and spending reductions in higher education and healthcare.
In addition to its nearly $70 billion in debt from a myriad of public issuers, Puerto Rico is struggling with a 45 percent poverty rate and unemployment that is more than twice the mainland U.S. average.
The bipartisan, seven-member oversight board was created under the federal Puerto Rico rescue law known as PROMESA, passed by the U.S. Congress last year. It is charged with helping the island manage its finances and navigate its way out of the economic jam, including by negotiating restructuring deals with creditors.
PROMESA calls for Puerto Rico's governor to deliver a fiscal turnaround plan, due on Jan. 28, to serve as a blueprint for the island's path out of crisis.
The law also imposed a freeze on litigation from creditors over debt payments, set to run out on Feb. 15.
Rossello, who won election in November and was sworn in on Jan. 2, asked for the deadline extensions, saying his new administration needed more time to assess the local financial situation and negotiate with creditors.
Rossello has only just now hired lawyers and financial advisers to represent the government in those talks.
Failing to reach consensual restructuring deals could push Puerto Rico and its many debt-issuing agencies into a messy and costly bankruptcy-like process under PROMESA. (Reporting by Nick Brown; Editing by Daniel Bases and Leslie Adler)