Detroit reaches deal with 2 banks to pay off debt - FOX13 News, WHBQ FOX 13

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>>

  • Menards customer killed by falling tiles

    Menards customer killed by falling tiles

    Sunday, August 31 2014 12:10 AM EDT2014-08-31 04:10:18 GMT
    Chesterfield Township police say a customer died Saturday after a pallet of ceramic tiles fell on top of him. The victim is identified as Richard V. Colletti, 38, of Clinton Township.
    Chesterfield Township police say a customer died Saturday after a pallet of ceramic tiles fell on top of him. The victim is identified as Richard V. Colletti, 38, of Clinton Township.
  • Search continues for murdered mother's missing children

    Search continues for murdered mother's missing children

    Saturday, August 30 2014 9:58 PM EDT2014-08-31 01:58:26 GMT
    It's been three months and the search continues for two missing children after their mother was found murdered.
    It's been three months and the search continues for two missing children after their mother was found murdered.
  • Flood victims get cleanup help from volunteers

    Flood victims get cleanup help from volunteers

    Saturday, August 30 2014 8:30 PM EDT2014-08-31 00:30:55 GMT
    It's been three weeks since historic floods submerged roads and highways and damaged thousands of homes and businesses across Metro Detroit. Saturday, volunteers came together to lend a helping hand.
    It's been three weeks since historic floods submerged roads and highways and damaged thousands of homes and businesses across Metro Detroit. Saturday, volunteers came together to lend a helping hand.
  • Download the FOX 2 Apps


  • FOX 2 News Five-Day Forecast
Powered by WorldNow

WHBQ-TV | Fox 13
485 S. Highland St.
Memphis, TN 38111

Main Station: (901) 320-1313
Newsroom: (901) 320-1340

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