Sovereign haircuts / HND

Honduras

4 concluded restructurings, between 1867 and 2001. The earliest default they settle began in 1828. The worst cost creditors 99.9% of the present value of their claim, in 1925. The longest gap between a default and its settlement was 52 years.

Restructurings

85.1%

Median present-value haircut

99.9%

Worst present-value haircut

1 of 4

Cut face value by zero

$581M

Debt treated (2020 $)

Every restructuring

Two measures of the same deals, never combined. The present-value haircut discounts what creditors got against what they were owed; the face-value reduction counts only principal written off.

Present-value haircutFace-value reduction

Default	Settled	Years to settle	Present-value haircut	Face-value reduction	Debt treated (2020 $)	Source
1828	1867	39	88.2%	38.9%	$8M	Meyer, Reinhart and Trebesch (2022)
1873	1925	52	99.9%	96.0%	$311M	Meyer, Reinhart and Trebesch (2022)
1981	1989	8	73.2%	0.0%	$243M	Cruces and Trebesch (2013)
1990	2001	11	82.0%	82.0%	$18M	Cruces and Trebesch (2013)

Source: Meyer, Reinhart & Trebesch (2022), Sovereign Bonds since Waterloo | Cruces & Trebesch (2013), Sovereign Defaults: The Price of Haircuts | Asonuma & Trebesch (2016) Debt treated is the amount restructured, deflated to constant 2020 US dollars in the source file. A negative haircut means the new instruments were worth more than the old claim. Methodology

Bond prices

1 of 4 Honduras restructuring episodes has Waterloo prices during the restructuring interval

The haircut file dates episodes by year. Waterloo matches them by country code and plots a padded window from one year before default through one year after settlement.

The public Waterloo bond panel in this repo runs from Jan 1, 1822 to Dec 1, 1980. This selector uses price only, never pbid or pask, and shows one line per bond from one year before default to one year after settlement. The author README defines price as “bond price in GBP and USD”; it does not document normalization to face value. Across all 329 haircut episodes, 111 have no Waterloo country-code match and 177 start after Dec 1, 1980. Those two counts overlap. 2 of 4 episodes start after the panel ends. 1 episode has prices only in the padded part of the window, outside the restructuring interval.

Episode

Selected episode: default 1873, settled 1925, case 162, spell HND_1873-1925. Window: Jan 1, 1872 to Dec 31, 1926.

GBP bond prices

Independent GBP y-axis; values are not scaled against another currency.

Bond legend (GBP)

10% Railway Loan of 1870, due 1885 (GBP)

10% Railway Loan of 1867, due 1884 (GBP)

1,093 monthly observations across 2 bonds. 1,057 of those observations fall inside the shaded restructuring interval. Earliest point in this window: Jan 1, 1872. Latest: Dec 1, 1926. One line equals one bond; no cross-bond average is computed.

Bond	Currency	ISIN	Obs.	First	Last
10% Railway Loan of 1870, due 1885	GBP	not recorded	653	Jan 1, 1872	Dec 1, 1926
10% Railway Loan of 1867, due 1884	GBP	not recorded	440	Jan 1, 1872	Aug 1, 1908

Each option includes its case id and default-spell id. The chart includes every priced bond for that country in the window, so it does not identify bonds belonging to the selected restructuring. The one-year padding is a display window, one year either side; an editorial choice rather than a source-defined threshold. It uses waterloo_bonds.price only; pbid and pask are not averaged into it. The author README defines price as “bond price in GBP and USD” and does not document face-value normalization. GBP and USD observations use separate labelled panels and y-axes. Of the 329 episodes in the haircut file, 111 have no Waterloo country-code match and 177 start after 1980-12-01; these counts overlap. Later episodes show an absence message rather than an implied zero.

Source: Meyer, Reinhart & Trebesch, Sovereign Bonds since Waterloo (bond-price panel) | Harvard Dataverse, Sovereign Bonds since Waterloo Methodology

Default spells

Spell	From	To	Years	Restructurings
HND_1828-1867	1828	1867	40	1
HND_1873-1925	1873	1925	53	1
HND_1981-2001	1981	2001	21	2

Source: Meyer, Reinhart & Trebesch (2022), Sovereign Bonds since Waterloo | Cruces & Trebesch (2013), Sovereign Defaults: The Price of Haircuts | Asonuma & Trebesch (2016) Duration counts both endpoints. The spells table also carries a cumulative-haircut column; it is not published here because it does not reconcile with the per-episode haircuts, see the methodology. Methodology

The Cruces-Trebesch record: a third measure and the discount rate

The Cruces-Trebesch file carries 2 restructurings here, and adds the market haircut (the new instruments against the face value of the old claim, undiscounted) and the exit yield used to do the discounting. The deal label is the file’s own and is finer than the country: it names the instrument class the deal covered. The two files were assembled separately, so a deal here need not line up one-to-one with a row above.

Deal	Date	Present value	Market	Face value	Exit yield	Structure	Data quality
Honduras	1989-10-01	73.2%	73.2%	0.0%	26.9%	-	3 / 5
Honduras	2001-08-01	82.0%	82.0%	82.0%	none (buy back)	buyback	3 / 5

Source: Cruces & Trebesch, haircut dataset (2014 update) Data quality is the file's own 1-to-5 index of how well the deal terms are documented. Methodology

Debt still in default

$468.4M across 3 creditor classes in 2024. A haircut can only be measured once a restructuring concludes, so any of this that is still being negotiated is by construction absent from the tables above.

Creditor class	In default, 2024
Domestic (fiscal) arrears	$441.0M
Other official creditors	$27.0M
Other private creditors	$390K

Source: Bank of Canada-Bank of England Sovereign Default Database (CRAG) Bank of Canada terms (attribution). Includes domestic arrears, so it is not comparable with the debt-treated column above. Methodology

Methodology, the measures, and what this data cannot tell you