BAKU (Reuters) - International Bank of Azerbaijan, the energy exporting country’s biggest lender, said on Wednesday a London court had supported its request to prevent creditors pursuing legal action in the United Kingdom, giving it time to restructure $3.3 billion (£2.5 billion) in debt.
A similar decision was made by a U.S. court last month.
The state-controlled bank said last month it was suspending payments on some liabilities and seeking creditors’ support to restructure more than $3 billion of debt, mostly owed to foreign creditors, to tackle bad loans left over from an oil price slump.
IBA presented a restructuring plan to its creditors on May 23 in London and infuriated them by saying they could swap its debt for sovereign bonds but some would suffer losses and have to wait longer to be repaid.
“Foreign creditors won’t be able to pursue legal actions against the bank’ assets and liabilities without the court’s permission,” IBA said in a statement published on its website.
Fitch Ratings has downgraded IBA’s long-term issuer default rating to ‘RD’ (Restricted Default) from ‘CCC’ and removed it from Rating Watch Evolving.
Reporting by Margarita Antidze; Editing by Ken Ferris