BUENOS AIRES: Argent­ina said on Tuesday it has revoked Bank of New York Mellon’s authorisation to operate in the country, after the bank froze Buenos Aires’s debt repayments under orders from a US judge.

“BoNY’s representation in Argentina has been revoked,” Argentine cabinet chief Jorge Capitanich told journalists, saying central bank regulators had adopted the measure in a resolution.

The bank has been caught up in the South American country’s vitriolic dispute with two US hedge funds whose refusal to accept a write-down on their Argentine bonds has derailed the country’s efforts to restructure its debt and forced it into its second default in 13 years.

US District Court Judge Thomas Griesa has ordered BoNY not to transfer Argentina’s interest payments on its restructured debt until the country settles the $1.3-billion dispute with the “holdout” hedge funds.

The bank’s compliance has infuriated Argentina, which accuses the judge of violating its sovereignty.

Published in Dawn, August 27th, 2014