Detroit reaches deal with 2 banks to pay off debt - Boston News, Weather, Sports | FOX 25 | MyFoxBoston

Detroit reaches deal with 2 banks to pay off debt

Posted: Updated:
(WJBK) -

Bankrupt Detroit has reached a new deal with two banks to settle millions of dollars in debt tied to an interest rate swap deal.

Fox 2's legal analyst Charlie Langton breaks down the deal as this:
1) The city borrows $285M from Barclays Bank, not $350M
2) City pays $165M to settle claims against all banks and creditors
3) City spends $120M for city services
4) City saves $128M

It still has to be approved by a bankruptcy judge who ordered the city to seek a better deal with the banks.

Detroit pledged casino tax revenue in 2009 as collateral to avoid defaulting on past pension debt payments. The swaps allowed Detroit to get fixed interest rates on pension bonds with UBS and Bank of America.

VIDEO: Charlie Langton breaks down the deal further and explains what it could mean for pensioners


Orr also says the city also has agreed to lower a financing loan to pay off the bank.

-The Associated Press contributed to this report

  • Local NewsLocal NewsMore>>

  • Easter Sunday benefit for Steve Utash and crime victims

    Easter Sunday benefit for Steve Utash and crime victims

    Sunday, April 20 2014 11:46 PM EDT2014-04-21 03:46:19 GMT
    Since his near death beating by a mob, family, friends and total strangers have rallied around Steven Utash. The latest show of support was on Easter Sunday at Bethany Baptist Church in Detroit.
    Since his near death beating by a mob, family, friends and total strangers have rallied around Steven Utash. The latest show of support was on Easter Sunday at Bethany Baptist Church in Detroit.
  • Wanted suspect arrested for high profile crimes

    Wanted suspect arrested for high profile crimes

    Sunday, April 20 2014 11:43 PM EDT2014-04-21 03:43:01 GMT
    A wanted suspect connected to serious crimes in Metro Detroit is now in custody. Ray Slayton, 47, was arrested Sunday morning at a hotel in Warren on felony drug charges.
    A wanted suspect connected to serious crimes in Metro Detroit is now in custody. Ray Slayton, 47, was arrested Sunday morning at a hotel in Warren on felony drug charges.
  • Recall: Kraft Foods recalls 96,000 pounds of Oscar Mayer Classic Wieners

    Recall: Kraft Foods recalls 96,000 pounds of Oscar Mayer Classic Wieners

    Sunday, April 20 2014 9:36 PM EDT2014-04-21 01:36:39 GMT
    Kraft Foods is recalling approximately 96,000 pounds of Oscar Mayer Classic Wieners because the products may contain Classic Cheese Dogs in the Classic Wieners' packages.
    Kraft Foods is recalling approximately 96,000 pounds of Oscar Mayer Classic Wieners because the products may contain Classic Cheese Dogs in the Classic Wieners' packages.
  • Download the FOX 2 Apps


  • FOX 2 News Five-Day Forecast
Powered by WorldNow

25 FOX Drive
Dedham, MA 02026

Phone (781) 467-2525

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | Terms of Service | Ad Choices