US banks scrap US$20 billion Argentina bailout

Updated at 6 p.m.U.S. banks JPMorgan Chase, Bank of America and Citigroup have called off a planned US$20 billion loan to Argentina, according to an article published on Thursday by The Wall Street Journal. Instead, bankers are discussing a new, short-term credit one-quarter the size. Minister Luis Caputo denied ever discussing a bailout with banks and said the news is meant to “spread confusion.” Nunca hablamos con los bancos de un rescate, ni de 20 mil millones. Es una “operación” más con la sola intención de generar confusión. https://t.co/XJqN9gB0Cj— totocaputo (@LuisCaputoAR) November 21, 2025 Reports of the US$20 billion bailout emerged last month, when U.S. Treasury Secretary Scott Bessent told journalists that the private sector was planning to invest in Argentina’s sovereign debt. Previously, the U.S. had arranged for a US$20 billion currency swap for Javier Milei’s administration, meaning that the total aid package would have been US$40 billion. “It is a private sector solution to Argentina’s upcoming debt payments,” Bessent told the press in October, ahead of the midterms. “We’ve actually been working on it for weeks.” However, bankers are now saying it is “no longer under serious consideration,” the Wall Street Journal reported, citing people familiar with the conversations. A spokesperson for Argentina’s economy ministry did not immediately respond to the Herald’s request for comment. Answering an X user who shared the article and asked “What the [expletive] is this?,” Economy Minister Luis Caputo replied “Excellent question.” He then went on to clarify that the government “never discussed a bailout with the banks, not about 20 billion. It’s just another ‘operation’ intended solely to spread confusion.” However, last month, Bessent mentioned a US$20 billion facility, adding that “many banks are interested in it and many sovereign funds have expressed interest in it.” In a separate interview after Bessent’s remarks, Caputo said, “we are working in another US$20 billion facility” on top of the U.S. currency swap. According to the newspaper, bankers have instead chosen to deliver a “smaller, short-term loan package” to support the financially distressed government. This new loan may be a US$5 billion repurchase agreement, also known as a “repo” facility. Under the arrangement, Argentina would exchange a portfolio of bonds for dollars from the banks. Argentina would then use the credit to cancel an upcoming debt payment of around US$4 billion in January, the New York-based outlet reported. Milei’s government would later work with the banks to take on new debt and pay back the repo facility “likely within months.” However, talks are still in early stages and “could change or fall apart.”  The U.S. Treasury assisted Argentina by selling dollars in the foreign exchange market ahead of the October 26 midterm elections, amid a currency run against the peso. The amount was never disclosed, but market sources calculate that the Trump administration put down well over US$2 billion in two weeks. Last week, U.S Treasury Secretary Scott Bessent confirmed that Argentina had activated the currency swap offered by the Trump administration. The announcement put an end to days of speculation, as local economists argued that it had already happened despite no confirmation from local authorities.Analysts consulted by the Herald at the time speculated that the currency swap, which entails new debt for Argentina, was used to pay back the dollars the U.S. sold to stave off the pre-electoral run against the peso.