Detroit, the largest U.S. city whose debt is rated below investment grade, warned investors of the risk of bankruptcy as it prepares to sell $250 million of bonds to help close its budget deficit, reports Bloomberg.
“If the city’s financial status were to deteriorate further the city’s options to improve its fiscal health may be limited,” Detroit said in its preliminary offering statement.
Detroit officials when into quite a bit of detail re a bankruptcy including the steps the city would have to take should bankruptcy become necessary.
“We are still in a financial crisis but insolvency isn’t on the horizon or on the agenda at this time,” Mayor Dave Bing said in an e-mail to Bloomberg from his spokesman, Dan Lijana
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