NFL, US banks agree to create offshore fund for Puerto Rico

Facing an influx of US and Puerto Rican investors in 2017, American and Puerto Rico banks agreed to create a new offshore fund to support the island’s economy.

The agreement, first reported by Bloomberg, comes after weeks of negotiations that have seen banks seek a $500 million infusion from a $4.5 billion trust fund they have set up in the Cayman Islands.

The two sides reached a deal last week to establish the Puerto Rico Fund, a joint venture that would use a $1 billion bond and $500,000 in US Treasury bonds to raise funds from investors, including pension funds, hedge funds and foreign investors. 

The Puerto Rico Trust Fund will be set up through a joint trust between American and Canadian banks, which would hold a 30 percent stake, according to a person familiar with the agreement who asked not to be identified discussing private talks.

The $1.5bn fund would be backed by a $3 billion guarantee from the US Treasury and the Caymans Bank Group.

The US Treasury is set to pay Puerto Rico a dividend of 2.5 percent on March 1. 

American and Pacific Bank of the United States said it would invest $1bn in the fund, and would work with Puerto Rico, the Caymen Islands and other institutions to manage the fund. “

We are committed to supporting the island financially through this new trust fund.” 

American and Pacific Bank of the United States said it would invest $1bn in the fund, and would work with Puerto Rico, the Caymen Islands and other institutions to manage the fund.

American and French Bank of Puerto Rico are also contributing $1b, while Citigroup, JPMorgan Chase, Goldman Sachs and Wells Fargo are also part of the fund’s backers. 

Puerto Rico, one of the poorest countries in the US and the world, has struggled with high unemployment and chronic shortages of basic services, including electricity and clean water.

The island has been struggling with a crippling debt crisis and is also struggling with the threat of climate change.

The U.N. has warned that climate change is a growing risk to the island and the global economy. 

With reporting by Reuters, AP and Reuters TV in San Juan, Puerto Rico