DETROIT (WKZO) -- A judge is expected to rule Thursday on whether Detroit can pay two banks roughly 165-million dollars to terminate a troubled pension deal.
U.S. Bankruptcy Judge Steven Rhodes says he will announce his decision at 2 p.m. on Thursday. The ruling will come following a trial that began last month and featured objections from bond issuers, pension funds, banks and several others.
At stake is a proposal to pay UBS AG and Bank of America 165-million dollars to end an interest rate swaps agreement tied to 1.4-billion dollars in money borrowed in 2005-2006 to prop up Detroit’s pension funds. If Rhodes approves the move, Detroit will pay off the banks with a 285-million dollar loan.