BNY Mellon Barred from Argentina

As a result of following U.S. District Court Judge Thomas Griesa’s order not to distribute $539 million in interest payments to the holders of Argentine government bonds, BNY Mellon has lost permission to operate within Argentina.

When the interest payments were withheld last month, the South American nation fell into debt default for the second time in 13 years..

Now, the Central Bank of Argentina’s Superintendent of Financial Institutions decided on Tuesday to revoke BNY Mellon’s authorization to operate in the country after citing the bank’s “lack of performance as a trustee,” according to Jorge Capitanich, chief of cabinet ministers for Argentina.

The nation’s executive and legislative branches also are crafting legislation that would replace BNY Mellon with state-run Banco Nacion as payment intermediary.

BNY Mellon also faces threats from euro-denominated sovereign debt holders, who also did not receive their interest payments on June 30, including financier George Soros, added Capitanich.

BNY Mellon did not return requests for comment.