The county of Orange said Thursday it has completed refinancing its bankruptcy debt from more than a decade ago.
The county paid off $565 million in debt related to the 1994 bankruptcy by issuing new bonds.
The move retires the bankruptcy debt a decade early and saves $102.5 million, according to the county.
“The refunding of this debt is our contribution to the future financial well being of Orange County,” said Bill Campbell, chairman of the board of supervisors.
In 1994, OC slipped into bankruptcy on the heels of a failed strategy by former county Treasurer Robert Citron, who used money borrowed from Merrill Lynch & Co. and others to bet on the direction of interest rates by purchasing longer-maturity derivatives.
The strategy, which first drew high returns, backfired as rates rose in 1994, resulting in losses of $1.6 billion and the county’s bankruptcy.
