by Linda Straker
- Virtual meeting for international bondholders on Friday, 6 September 2024
- Grenada’s 7.0% Bonds due 2030 with code ISIN: USP48863AE77 will experience deferral payment
- CCRIF made US$44 million policy payment to Grenada on 16 July
The impact of Hurricane Beryl on Grenada, the activation of the hurricane clause and the general outlook of the economy will be the topics of discussion when Grenada holds a virtual meeting for investors of its 2030 International Bond Holders on Friday, 6 September 2024.
All interested investors must register to attend the event no later than on Wednesday, 4 September. The registration form is available on the Ministry of Finance website.
A statement on the website explains that Grenada’s 7.0% Bonds due 2030 with the code ISIN: USP48863AE77 will experience a deferral payment because of Hurricane Beryl which affected the island on 1 July.
“Grenada has elected to make a Deferral Claim as a result of the Event. As the Modelled Loss is greater than US$30 million, the Deferral Dates as a result of the Event include each of the next 2 consecutive Payment Dates following the submission of the Deferral Claim (i.e., the payment dates falling on 12 November 2024 and 12 May 2025),” said the statement. “The portion of a Deferred Payment Amount that is comprised of interest will be converted into principal on and with effect from the relevant Deferral Date. Where such interest is converted into principal, the principal amount of the Debt Securities shall be increased in the amount of such deferred interest.”
Issued by the Government of Grenada pursuant to an indenture dated as of 12 November 2015, between Grenada and The Bank of New York Mellon as trustee. Pursuant to paragraph 18 of the Conditions, Grenada may elect to defer payment of the Deferred Payment Amount on a Deferral Date following the occurrence of a Caribbean Tropical Cyclone Event in respect of which a Policy Payment has been made to Grenada.
The statement said that on 1 July 2024, Hurricane Beryl, a Category 4 storm, made landfall and caused catastrophic damage to Grenada. The damage and casualties from the hurricane were widely reported in the news and on 16 July 2024, the Caribbean Catastrophe Risk Insurance Facility (CCRIF) made a US$44 million policy payment to Grenada.
The statement said that Grenada confirmed that
- the CCRIF Policy is in full force and effect, and CCRIF has issued a written report confirming that the Event is an Insured Event in respect of which a Policy Payment has been made to Grenada
- since the Issue Date, none of the Ceding Percentage, the Coverage Limit or the Exhaustion Point applicable to tropical cyclones has been reduced, unless it has been reduced by CCRIF and CCRIF has declined a request submitted by Grenada to CCRIF to maintain such Ceding Percentage, Coverage Limit or Exhaustion Point, as the case may be; and
- the Modelled Loss to Grenada from the Event is greater than US$15 million.
White Oak Advisory which is an independent financial advisory firm providing specialist, high-level, and conflict-free advice to governments and other clients on matters relating to sovereign finances and sovereign debt, acted as the financial advisor, and Cleary Gottlieb Steen & Hamilton LLP acted as the legal advisor, to the Government of Grenada with respective to the 2030 bonds.
